Regression Trend Channel Indicator for MT4 – Free Download [TradingFinder]

The Regression Trend Channel Indicator is a trading tool based on linear regression developed for the MetaTrader 4 platform.

It is used for analyzing trend direction and price volatility. This indicator draws a channel consisting of a central band and two upper and lower boundaries, identifying dynamic support and resistance zones.

The ability to scale the channel using either ATR or standard deviation enhances its accuracy in markets with fluctuating volatility.

Regression Trend Channel Indicator Table

The general specifications of the Regression Trend Channel Indicator are presented in the table below.

Regression Trend Channel Indicator Overview

The Regression Trend Channel Indicator is built on linear regression analysis and is plotted on the chart as a three-part channel:

• The centerline represents the average price path over a defined period and indicates the main market direction;
• The upper band is calculated by adding a fixed value (standard deviation or ATR) to the centerline, which acts as a dynamic resistance;
• The lower band is formed by subtracting the same value from the centerline, serving as dynamic support.

The Indicator is in an Uptrend

The chart below shows the GBP/JPY currency pair on a 15-minute timeframe. In an uptrend structure, when the price stabilizes above the channel’s centerline and moves toward the upper band, it signals buyer dominance and trend strength.

A corrective pullback to the centerline, followed by a positive reaction and confirmation candle, provides a favorable buying opportunity.

The Indicator in a Downtrend

The image below displays the EUR/AUD pair on a 5-minute timeframe. In bearish conditions, when the price remains below the centerline and moves toward the lower band, it reflects selling pressure.

A return to the centerline and consolidation below it—alongside bearish candlestick formations—creates a suitable setup for short positions.

Linear Regression Channel Indicator Settings

The image below shows the settings panel of the Regression Trend Channel Indicator:

• Gray: Gray color;
• Medium Sea Green: Light green;
• Fire Brick: Deep red;
• None: No color;
• None: No color;
• None: No color;
• Medium Sea Green: Light green;
• Fire Brick: Deep red.

Conclusion

The Regression Trend Channel Indicator in MetaTrader 4 is a statistical tool for technical analysis that draws a channel based on linear regression, outlining the direction of price movement and dynamic support/resistance zones.

The use of upper and lower bands, along with the centerline, allows traders to identify reversal points or trend continuations in the market structure.