In a linear regression plot, the straight line represents the best attempt to minimize the residual sum of squares between known or observed data points and the predicted data points.

Example 55.4: Displaying Plots for Simple Linear Regression This example introduces the basic PROC REG graphics syntax used to produce a standard plot of data from the aerobic fitness data set ...

That is the the basic form of linear regression by hand. Note that there ARE other ways to do this - more complicated ways (assuming different types of distributions for the data).

Residual plots can be used to validate assumptions about the regression model. Figure 1: Residual plots are helpful in assessments of nonlinear trends and heteroscedasticity. A formal test of lack ...

xkcd #2048 is exceptionally relevant to this. Doing linear regression well with a big dataset is difficult! I do this all the time at work and honestly I often show a scatter plot without any ...

It is an output of regression analysis and can be used as a prediction tool for indicators and price movements. In finance, the line of best fit is used to identify trends or correlations in ...