Time Series Forecast indicator

Time Series Forecast or TSF indicator is a trend indicator which shows the underlying trend of a security and tries to predict future price movements. The indicator works on the principle of least-squares fit method and is plotted by calculating the linear regression trendlines.

Time series forecast indicator plotted just like linear regression indicator, by taking the end points of many simultaneous linear regression trendlines. But, unlike linear regression indicator, TSF also considers slop of the trend. This makes TSF more responsive to new trends and thus is better suited for short-term traders like day traders as it actually predicts the next period’s price level. Time series indicator is also known as ‘Moving linear regression indicator’ and ‘regression oscillator’.

Time series forecast is interpreted like moving averages and linear regression indicator. When price stays above the indicator, then the instrument is in bullish trend and when the price stays below then vice versa. Price movements across the level is considered as a buying/selling opportunity and price movements away from the line is considered short-lived and price is expected to comeback to the level.

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