![]() ![]() ![]() The bulk of the points normally take place toward the middle of the bell curve, but over time, the points stray, or deviate from the population. The bell curve represents the form of the various data point occurrences. Figure 1 is an example of a bell curve, which is denoted by the dark blue line. Statisticians have used the bell curve method, also known as a normal distribution, to evaluate a particular set of data points. A stock's price and time period determine the system parameters for linear regression, making the method universally applicable.Using linear regression, a trader can identify key price points-entry price, stop-loss price, and exit prices.Plotting stock prices along a normal distribution-bell curve-can allow traders to see when a stock is overbought or oversold.Linear regression is the analysis of two separate variables to define a single relationship and is a useful measure for technical and quantitative analysis in financial markets. ![]()
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |