Bruce,

I recently added a 5-period Linear Regression Indicator to my chart using the "off-the-shelf" Moving Lin Reg Indicator ...

... which is basically the same as ...

What I'd like to do next is create a "Linear Regression Reversal Indicator" which plots a +1 when the 5-period linear regression direction is up and a -1 when prices reverse and the 5-period linear regression direction moves down...

I'm assuming the simplest way to do this is with a Custom PCF Indicator, but PCFs aren't my strong suit, and I could use a little help with the PCF needed to plot this indicator.

Thanks!

Please try using one of the following Indicator Formulas in your Custom PCF Indicator:

SGN(AVGC5 + 2 * (2 * C + C1 - C3 - 2 * C4) / 10 - AVGC5.1 - 2 * (2 * C1 + C2 - C4 - 2 * C5) / 10)

Or the shorter:

SGN(3 * C - C1 - C2 - C3 - C4 + C5)

Or the even shorter:

SGN(3 * C - 4 * AVGC4.1 + C5)

Using Linear Regression vs Classical Peaks/Valleys for Divergence Analysis
PCF Formula Descriptions
Handy PCF example formulas to help you learn the syntax of PCFs!

I dunno if my fingers can take all that typing, Bruce ... can't you make it a little shorter? ;)

Thanks.

I can't think of a way to shorten it. I only provided all three versions so you could see how the basic idea of how the formula started and how it developed into the shortest posted version.

Hi Bruce, one more request for today...

Earlier in the week you wrote the above Indicator Formulas for a 5-period "Linear Regression Reversal Custom PCF Indicator".

Can I bother you for the 8-period, 13-period, and 21-period versions?

Thanks again.

8-Period:

SGN(5 * C - 7 * AVGC7.1 + 2 * C8)

13-Period:

SGN(25 * C - 36 * AVGC12.1 + 11 * C13)

21-Period:

SGN(41 * C - 60 * AVGC20.1 + 19 * C21)

Sweet!

Hi Bruce,

I was trying to plot these 4 indicators and I had a problem with the 8 period one.

While it looks similar to the other 3 - the plot is a flatline at 1 and the range shows 1 to 1.10

Could you review that one for me.

Also, is it possible to tab indicators to the side of the chart?

Regards and thanks

Bob Mc

Bruce, I'm getting the same results; looks like there might be something hinky with the 8-period PCF...

I have corrected the formula above. It should have been obvious to me that it was wrong when I posted it as the sum of the coefficients should add up to zero (and 5 - 7 + 3 = 1).

Thanks Bruce.

Thanks from me too

Regards

Bob Mc

Hi Bruce,

When you have a chance, can you please whip up 34-period and 55-period versions?

Thanks!

34-Period:

SGN(67 * C - 99 * AVGC33.1 + 32 * C34)

55-Period:

SGN(109 * C - 162 * AVGC54.1 + 53 * C55)

You may also want to go back and take a look at my Friday, June 29, 2012 11:37:15 AM ET post as I've made some adjustments to it as well.

I have figured out a relatively quick way to make these formulas.

SGN((2 * period - 1) * C - 3 * (period - 1) * AVGCperiod.1 + (period - 2) * Cperiod)

Thanks again Bruce!

Hi Bruce,

Up to now I've asked for PCFs based on Fibs (5, 8, 13, 21, 34, 55).
This time I have a single "non-fib" request.

Can you please write a PCF for a 65-Period "Linear Regression Reversal Custom PCF Indicator"?
(It's a long story; I won't bore you with the details).

Thanks!

65-Period:

SGN(129 * C - 192 * AVGC64.1 + 63 * C65)

Bruce, you're the best!

Please try the following Indicator Formula.

SGN(99 * C - 147 * AVGC50.1 + 48 * C50)

Hi Bruce, can you create a 30-period version? Thanks!

You can use the template given in my Thursday, August 02, 2012 7:52:41 AM ET post to create these on your own.

SGN((2 * period - 1) * C - 3 * (period - 1) * AVGCperiod.1 + (period - 2) * Cperiod)

SGN((2 * 30 - 1) * C - 3 * (30 - 1) * AVGC30.1 + (30 - 2) * C30)

SGN(59 * C - 87 * AVGC30.1 + 28) * C30)

Awesome, Bruce. Thanks. Happy New Year!!

You're welcome. Happy New Year!