Using the R² to Generate Trading Signals

Creating and Coding the R² Square Indicator for Market Trading

In statistical analysis and econometrics we are often confronted with metrics that judge our models. When we fit data to another in order to predict it, we have a goodness-of-fit measure called R² that tells us how good is our linear model. In this article, we will use that R² and transform it into a technical indicator, then we will derive signals and …