Linear Regression Channel Indicator for MT4

The Linear Regression Channel Indicator for MT4 is one of the most popular forex price channel indicators, including Fibonacci Channel, Keltner Channel, or Andrews Pitchfork Channel. It consists of three extensions to each side. These extensions are used to analyze the upper and lower limits of an ongoing trend. It helps traders to find the best entry points and exit points during price movements on the chart.

How to trade with the linear regression channel?

The first step you need to take while trading with the Linear Regression Channel Indicator is to check the slope of the channel, whenever it is upwards or downwards. After you define it, proceed to define the entry point which stands at the penultimate extensions or the last extension. Detailed instructions are provided below.

Buy Signal

Follow these steps for a long trade:

  • The Linear Regression Channel slope is bullish
  • Price rejects the penultimate or last extension
  • Price swings higher from recent low swing
  • Buy trade is triggered after the above conditions are met
  • Set stop loss a few pips below the last swing low of the market
  • Take profit or exit whenever price reaches the opposite penultimate or last extension or use your own method of trade exit

Linear Regression Channel Indicator Example of Buy Trade

Sell Signal

Follow these steps for a short trade:

  • The Linear Regression Channel slope is bearish
  • Price rejects the penultimate or last extension
  • Price swings lower from recent high swing
  • Sell trade is triggered after the above conditions are met
  • Set stop loss a few pips above the last swing high of the market
  • Take profit or exit whenever price reaches the opposite penultimate or last extension or use your own method of trade exit

Linear Regression Channel Indicator Example of Sell Trade


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