Drawing Tools can be applied, moved, and formatted, directly on a chart, providing tremendous flexibility. Many drawing tools allow you to analyze new data on a chart by extending the drawing object to the left or to the right of the chart. You can use them to call attention to any area of a chart you wish.
This tool is based on linear regression, but the channel is based on the minimal upward or downward oscillation in the selected period.
The Regression Channel contains price movement with the bottom line serving as support line & the top line serving as resistance line. A common interpretation is that if prices remain outside the channel for a long period of time, then a reversal may take place.