Regression Analysis Scalping System For MT4

Regression Analysis Scalping System For MT4

Table Of Contents:

  1. Regression Analysis Scalping System For MT4
  2. The Regression Analysis Scalping System For MT4 – Long positions
  3. The Regression Analysis Scalping System For MT4 – Short positions
  4. Is the Regression Analysis Scalping System For MT4 profitable?


Please note: This strategy was publicly published in the trading community and is free to use. We do NOT make an attempt to decide if this strategy is profitable or not, because we know that the major factors regarding trading results are the skills/experience of the trader who executes the strategy. Therefore, we are mainly explaining the components and rules of the strategy. If applicable, we are highlighting advantages, disadvantages and possible improvements of the strategy.


When it comes to building a forex trading strategy, the developers of trading systems often tried to use fancy words. The basic idea is that the fancier the title or the indicators used in trading system are, the more appeal it has among the trading community. After all, traders prefer to trade with a forex trading strategy that they can barely understand. This illusion comes from the fact that the trading system is too complex and very smart for the average trader to understand.

Sadly, the Regression Analysis Scalping System For MT4 is one such example of a trading system. For one, not many traders really understand what the meaning of regression analysis is. For the sake of clarity let us explain this a bit more in detail. Regression is a statistical term that is used To describe the best fit method between a set of variable data points.


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As you can see from the chart above, the regression analysis scalping system makes use of a custom indicator called the regression analysis indicator. This indicator plots a couple of lines based on the current price action. Following this, the lines are set to a fixed standard deviation levels away on top and bottom. What you get at the end is a regression channel line that is used as a best fit method for a given set of prices. While this might seem fancy enough, an important point to bear in mind is that the regression analysis indicator takes into account only a fixed number of data points. This means that every time new price evolves, the regression line tends to change.

An obvious disadvantage of using this method is the fact that the regression analysis indicator repaints quite a bit. Traders are usually averse to using an indicator which repaints. However, in the case of the regression analysis indicator that the painting is a necessity. This is because the indicator tends to adapt itself as in when new data points are introduced. For the average trader, this means that it is difficult to visualize how the regression channel line looked like in the past.

There are two templates that comes with the regression analysis scalping system. However, there is not much difference between these two as traders can use either of the two. The main important point is that the regression analysis indicator remains the same on the price chart. It is only the indicator in the sub window which changes. Even this customized indicator does not show much information. All we can see is a trading oscillated that moves between overbought and oversold levels.

Before going into further details, we should warn the reader that this trading strategy is not suitable for everyone. Although the trading signals look quite easy to understand and trade, bear in mind that we are doing this in hindsight only. This means that it can be a bit of a challenge when you are trading with the regression analysis scalping system real time.

Let's now take a look at how you can trade long and short positions using the Regression analysis scalping strategy with filter for MT4.



The Regression Analysis Scalping System For MT4 – Long positions




For a long position using the regression analysis scalping strategy, wait for price to trade near the lower bounds of the channel. Now focus attention to the custom oscillator which is the RSX smooth oscillator. This also later should be moving out from the oversold levels. This means that the color would also change from pink to green.

After the RSX smooth oscillator moves above the value of 20, you can then take a long position at market. Set your stop loss to the recent swing low that formed an adjust your take profit level initially to the pink middle regression line. The remainder of your trade should be trading at break even while targeting the upper blue line.



The Regression Analysis Scalping System For MT4 – Short positions




For a short position using the regression analysis scalping strategy, wait for price to trade near the upper bounds of the channel. Now focus attention to the custom oscillator which is the RSX smooth oscillator. This also later should be moving out from the overbought levels. This means that the color would also change from green to pink.

After the RSX smooth oscillator moves above the value of 80, you can then take a short position at market. Set your stop loss to the recent swing high that formed an adjust your take profit level initially to the pink middle regression line. The remainder of your trade should be trading at break even while targeting the upper blue line.



Is the Regression Analysis Scalping System For MT4 profitable?


In conclusion, the regression analysis scalping strategy might seem to be quite a reliable trading system for short term scalping. However, this is not the case in reality as you will realize when you try trading with this strategy in the real markets. The trader needs to have a good understanding of how regression analysis works and also pay attention to the evolving price action.

The trading template that comes with the regression analysis scalping strategy is lightweight due to the few number of indicators that are used. There is no scope for further improving this trading system. This is a short term scalping strategy where the main trades are based off the short term retracements in the price within the trend. This means that there is an opportunity for multiple trading signals to be generated. However, trader should not blindly be trading these signals but rather apply some logic and also understand the market context.

We can recommend the regression analysis scalping strategy to be used even by beginners. However, you should practice enough on a demo trading account before trading this strategy on the real markets. While you can monitor multiple instruments at the same time using the template, we do not recommend to do so as you can easily get confused and end up over trading which can lead to huge losses.

Download the complete system description and the files here:

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