Linear Regression Acceleration Oil Technical Analysis & Trading Signals

Linear Regression Acceleration calculates the change in the regression line's gradient on the current crude trading price bar from its gradient from the previous crude trading price bar. The value used to calculate the linear regression is referred to as the normalized acceleration value which is drawn for each crude trading price bar formed on the crude trading price chart.

Linear Regression Acceleration

If the normalized acceleration is 0.30, then regression line normalized slope will be rising at the rate of 0.30 per crude trading price bar.

Similarly, a normalized slope of -0.40 would indicate that regression line normalized slope is declining at the rate of -0.40 per crude trading price bar.

For example, if the current crude trading price bar normalized slope value is 0.40 and the previous crude trading price bar normalized slope value is 0.20, then the normalized acceleration of the current crude oil price bar would be calculated as 0.40 - 0.20 = 0.20.

Note: It is important to realize that a positive acceleration value does not equate to a positive slope value, it simply means gradient of the slope is increasing. A negative acceleration value does not equate to a negative slope value, it simply means the gradient of slope is decreasing.

Implementation of Linear Acceleration Regression Technical Indicator

The Linear Regression Acceleration indicator allows for the following; crude trading price selection, regression periods, smoothing of raw crude oil price before applying the regression and selection of the smoothing type.

Resulting regression slope is displayed as a bi-colored histogram which oscillates above and below 0.

reference line is set at the 0 level mark.

• A rising slope: (greater than its previous value of One bar before) is displayed in the up slope color.
• A declining slope: (lower than its previous value of One bar before) is shown using the down slope color.