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The Regression study looks at a sample of price data over a discrete time period and represents all of those data points in the form of a straight line that best represents the trend of price data for the period.. You may apply the study to any of the price data types.

The "Use Last X Bars" option allows you to create a dynamic linear regression line.  The line will always be based on the last X bars in your chart.  If you are watching a 1 minute chart, the regression line will dynamically change based on changes in your most recent 1 minute bar.  When a new bar is formed, the line will be redrawn based on the most recent data.  The regression line will always be considering the most recent bars and the latest ticks.

Click the linear regression icon in the charting tool palette to enable the linear regression drawing tool and hold your mouse button down while you drag the drawing tool between the two points of interest. When you release the mouse button Investor/RT draws the regression line. As an option, you may choose to draw straight band lines parallel to the regression line. The bands are drawn a user-specified distance above and below the regression line. The distance is specified by the user as the number of standard deviations away from the regression line.

The following approximations offer a few rules of thumb for using the standard deviation settings:

Plus or minus one standard deviation takes in 68.3% of all expected outcomes (historical price moves) Plus or minus two standard deviations takes in 95.4% of all expected outcomes (historical price moves) Plus or minus three standard deviations takes in 99.7% of all expected outcomes (historical price moves)

For example, excursions of price more than 2 standard deviations above or below the regression line represent an unlikely event (less than 5% probable). Such excursions usually represent overbought or oversold conditions