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Forex Glossary

The Industry's Most Important Terms Explained

The forex industry is made up of countless definitions and it's easy to forget a few along the way. But because no forex education can be complete without a glossary of forex terms, we've compiled one which aims at explaining key definitions in the simplest way possible. This way, you'll never be lost or confused again!


Linear Regression Channel

A Technical Analysis tool used for trend identification for a set of prices under a period of study. It is attached on the chart by selecting the first price representing the beginning of the trend and then dragging the mouse to the second price in the direction of the trend.

It consists of three lines:

  1. Linear Regression Trendline
  2. Upper Channel Line
  3. Lower Channel Line

The Linear Regression Trendline, is an equilibrium line that is, a straight line run through a set of prices using the statistical technique of best fit (or least squares) for a period under study.  The Upper and Lower Lines are parallel to and equidistant from the Trendline.  The distance between either Line and the Trendline, represents the maximum close price deviation from the Regression Trendline.

Category: Technical Analysis

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