> What are the red line and cut line in lm's Residuals vs Fitted plot?
The dotted line is at 0 and the red line is a locally weighted regression 
calculated using lowess and plotted using panel.smooth. 

See ?panel.smooth and ?lowess for details

The main clue to this is in the arguments to ?plot.lm, which uses panel.smooth 
as a panel function. 

S Ellison

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