Introduction To Past Regression Deviated Indicator For MT4

Past Regression Deviated Indicator For MT4 is a trend following indicator, just like the famous Stochastic. This indicator helps the traders in identifying various trading opportunities and market patterns that are otherwise hard to recognize. This indicator is plotted on to the price chart, and it consists of seven parallel lines that form a price channel. Traders also use these lines as dynamic support and resistance levels. Moreover, these lines determine the current trend of the market. 

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The idea behind the Past Regression Deviated Indicator For MT4 is this - When price action is far from the centerline of the indicator, prices tend to return. When the price action goes near the red line, it means that the market is at an overbought/oversold area. These levels are similar to other oscillator indicators, such as an RSI, CCI, MACD, and Stochastic. This indicator can be used to design various trading strategies, and in this article, we have shared a couple of them.

Trading Strategies Using Past Regression Deviated Indicator For MT4

Past Regression Deviated Indicator For MT4 consists of seven parallel lines. Most of the time, the price stays between the first three lines, and these lines act as a support/resistance to the price action. The more the price rises towards the upper lines, the stronger the resistance is, and the more the prices of an underlying asset drop towards the lower line, the more dynamic the support is.

Buy Example

The trading idea with this indicator is this. In trending market conditions, when price action hits the lower band (dynamic support) and holds there for a couple of candles, it is a sign to take a buy trade. 

In the above image, at a dynamic support area, prices hold for a couple of candles, which is a sign to go long. We can see how the market shot up after the trading signal generated by Past Regression Deviated Indicator For MT4.

Sell Example

In bearish market conditions, when the prices hit the upper bands (dynamic resistance), it means the selling trend is ready to resume.

In the above image, when price action hits the top upper band, it's a clue to go short. Aggressive traders usually use center lines to take trades, but these center lines do not hold much power to stop the price action, and they often generate a lot of false signals. These center lines act as a dynamic support/resistance in the consolidation market. Please check the below strategy; we have designed this strategy, especially for range trading using Past Regression Deviated Indicator For MT4.

Trading Ranges Using Past Regression Deviated Indicator For MT4

Most of the novice traders or even some experienced traders do not know how to use Past Regression Deviated Indicator For MT4 to trade the ranging conditions. Traders sometimes use the second line, third line, or even fourth line to trade ranges. In reality, price action often respects the second last line (orange line) to trade the ranges. When prices close between the orange and black lines, that's the best time to trade the ranging market.

In the above image, you can see that four times price action respects the orange line, which is an indication for potential buy and sell signals.

Bottom Line

Past Regression Deviated Indicator For MT4 is a trend following indicator. It is not that popular in the trading community when compared to other reliable indicators. Overall this indicator reacts as a dynamic support/resistance to the price action. These seven lines expand and contract based on the volatility of the market. When prices keep touching the last line, it means that the selling trend is quite strong, and when price action stays near the top line, it indicates the buying trend. If you are a novice trader, use the default setting, and when you get used to this indicator, tweak the settings according to your trading style. Cheers!

 

 

 

 

 

 

 

 

 

 

 

 

 

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