Introduction to Linear Regression Moving Average Indicators
Most moving averages tend to lag too far and produce late trading signals. Linear regression moving average (LRMA) indicators, also known as linear regression indicators or moving linear regression indicators, are designed to display a very sensitive moving average line that can respond much more quickly to price action moves and movements.
What is a linear regression moving average indicator?
The LRMA indicator is a moving average that draws a line that is more responsive than most moving averages.
This version of the LRMA indicator draws a line that changes color depending on the direction of trend or momentum. Draw a green line to indicate bullish momentum, a red line to indicate bearish momentum, and a yellow line to indicate a possible trend or momentum reversal.
How does the linear regression moving average indicator work?
The LRMA indicator counts each candle or bar as an endpoint. yen Number of period liner regression lines. This is why the LRMA indicator draws a line that is very sensitive to price movement.
This version of the LRMA indicator changes the color of the line as the slope of the line changes. Draw a green line when the LRMA line slopes up and a red line when it slopes down. Draw a yellow line if there is a change in the slope of the line indicating that the previous trend will weaken or reverse.
How to use a linear regression moving average indicator for MT4
The LRMA indicator has three variables that allow the user to adjust and modify the LRMA line.
“Period” allows the user to change the number of bars the indicator will count when determining the LRMA line.
“Price” refers to the price range the indicator uses when calculating the LRMA line, whether it is the close, open, high or low of each bar.
“Shift” allows you to move the LRMA line forward or backward.
Given the responsive nature of the LRMA line, this indicator is best used as a faster moving average line component of a moving average crossover pair when trading trend reversal or trend following strategies.
In the example below, we will use a 20-period Simple Moving Average (SMA) as a slow line paired with an LRMA line.
Buy transaction settings
When do you enter?
Open a buy order as soon as the LRMA line crosses above the slow moving average line. Set Stop Loss below the moving average.
When do you quit?
Close the trade as soon as the LRMA line crosses below the slow moving average line.
Set up a sell trade
When do you enter?
Open a sell order as soon as the LRMA line crosses below the slow moving average line. Set Stop Loss above the moving average.
When do you quit?
Close the trade as soon as the LRMA line crosses above the slow moving average line.
As a responsive moving average, the LRMA allows traders to start trading earlier and earn higher returns on potentially winning trades. However, like most moving averages that are highly responsive to price movements, LRMA lines also tend to be less effective when used in uneven market conditions. Therefore, it should not be traded blindly as a single trading signal. Instead, it should be integrated into the bigger picture trading strategy.
MT4 Indicators – Download Instructions
The Linear Regression Moving Average Indicator for MT4 is the MetaTrader 4 (MT4) Indicator and the essence of this technical indicator is to transform the accumulated historical data.
The Linear Regression Moving Average Indicator for MT4 provides an opportunity to detect various characteristics and patterns in price dynamics that are not visible to the naked eye.
Based on this information, traders can make assumptions about further price movements and adjust their strategies accordingly. Click here to view the MT4 strategy.
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How to install linear regression moving average indicator for MT4.mq4?
- Download Linear Regression Moving Average Indicator for MT4.mq4
- Copy Linear Regression Moving Average Indicator for MT4.mq4 to Metatrader Directory / experts / indicators /
- Start or restart the Metatrader 4 client
- Choose a chart and timeframe to test your MT4 indicators on.
- Search for “Custom Indicators” in the navigator, which remains mostly in the Metatrader 4 client.
- Right-click on the linear regression moving average indicator for MT4.mq4.
- attach to chart
- Edit the settings or click OK.
- Indicator Linear Regression Moving Average indicator for MT4.mq4 is available on your chart
How to remove linear regression moving average indicator for MT4.mq4 from Metatrader chart?
- In the Metatrader 4 client, select the chart on which the indicator runs.
- right click on the chart
- “List of Indicators”
- Select a metric and delete it
Linear Regression Moving Average Indicator for MT4 (Free Download)
Click below to download.