Standard Error(STDERR) measurement is based upon how closely the price of a security falls from the Linear Regression Trendline.
The closer prices are to the trendline, the stronger the trend. The more variance from the regression line, the larger the standard error and the less reliable the trend. High Standard Error values indicate that the price is quite volatile. Any changes in the prevailing trend is usually preceded by a rapidly increasing standard error.
This indicator can be used in combination with R-Squared. Most trend changes are usually preceded by decreasing R-Squared values and increasing Standard Error. When the two are at extreme values and begin to converge, expect a change.
However, be aware that changes in trend does not necessarily mean that an upward trend will reverse to a downward trend. Sideways movement is also considered a change.
Calculation:
avg(Price)= The average of the prices in the selected period
avg(bar)= The average number of the bars in the selected period
Inputs:
Price Field = Close
Indicates Open, High, Low or Closing price.
Period = 21
Indicates time period(the number of days for daily analysis, the number of weeks for weekly analysis, etc.).
Indicator Type: Trend