Stock Price Trends
Stock price trends estimated using linear regression.
Summary
Key facts
- The primary trend is increasing.
- The growth rate of the primary trend is 48.30% per annum.
- T price at the close of May 20, 2024 was $17.52 and was lower than the bottom border of the primary price channel by $0.04 (0.22%). This indicates a possible reversal in the primary trend direction.
- The secondary trend is increasing.
- The growth rate of the secondary trend is 11.23% per annum.
- T price at the close of May 20, 2024 was inside the secondary price channel.
Linear Regression Model
Model equation:
Yi = α + β × Xi + εi
Top border of price channel:
Exp(Yi) = Exp(a + b × Xi + 2 × s)
Bottom border of price channel:
Exp(Yi) = Exp(a + b × Xi – 2 × s)
where:
i - observation number
Yi - natural logarithm of T price
Xi - time index, 1 day interval
σ - standard deviation of εi
a - estimator of α
b - estimator of β
s - estimator of σ
Exp() - calculates the exponent of e
Primary Trend
Start date: July 14, 2023
End date: April 5, 2024
a = 0.9507
b = 0.0011
s = 0.0283
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × 0.0011) – 1
= 48.30%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0283) – 1
= 11.98%
July 14, 2023 calculations
Top border of price channel:
Exp(Y1,044)
= Exp(a + b × X1,044 + 2 × s)
= Exp(a + b × 1,515 + 2 × s)
= Exp(0.9507 + 0.0011 × 1,515 + 2 × 0.0283)
= Exp(2.6429)
= $14.05
Bottom border of price channel:
Exp(Y1,044)
= Exp(a + b × X1,044 – 2 × s)
= Exp(a + b × 1,515 – 2 × s)
= Exp(0.9507 + 0.0011 × 1,515 – 2 × 0.0283)
= Exp(2.5298)
= $12.55
April 5, 2024 calculations
Top border of price channel:
Exp(Y1,227)
= Exp(a + b × X1,227 + 2 × s)
= Exp(a + b × 1,781 + 2 × s)
= Exp(0.9507 + 0.0011 × 1,781 + 2 × 0.0283)
= Exp(2.9301)
= $18.73
Bottom border of price channel:
Exp(Y1,227)
= Exp(a + b × X1,227 – 2 × s)
= Exp(a + b × 1,781 – 2 × s)
= Exp(0.9507 + 0.0011 × 1,781 – 2 × 0.0283)
= Exp(2.8169)
= $16.73
Description
- The primary trend is increasing.
- The growth rate of the primary trend is 48.30% per annum.
- T price at the close of May 20, 2024 was $17.52 and was lower than the bottom border of the primary price channel by $0.04 (0.22%). This indicates a possible reversal in the primary trend direction.
Secondary Trend
Start date: November 30, 2023
End date: May 20, 2024
a = 2.3072
b = 0.0003
s = 0.0217
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × 0.0003) – 1
= 11.23%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0217) – 1
= 9.06%
November 30, 2023 calculations
Top border of price channel:
Exp(Y1,141)
= Exp(a + b × X1,141 + 2 × s)
= Exp(a + b × 1,654 + 2 × s)
= Exp(2.3072 + 0.0003 × 1,654 + 2 × 0.0217)
= Exp(2.8329)
= $16.99
Bottom border of price channel:
Exp(Y1,141)
= Exp(a + b × X1,141 – 2 × s)
= Exp(a + b × 1,654 – 2 × s)
= Exp(2.3072 + 0.0003 × 1,654 – 2 × 0.0217)
= Exp(2.7461)
= $15.58
May 20, 2024 calculations
Top border of price channel:
Exp(Y1,258)
= Exp(a + b × X1,258 + 2 × s)
= Exp(a + b × 1,826 + 2 × s)
= Exp(2.3072 + 0.0003 × 1,826 + 2 × 0.0217)
= Exp(2.8830)
= $17.87
Bottom border of price channel:
Exp(Y1,258)
= Exp(a + b × X1,258 – 2 × s)
= Exp(a + b × 1,826 – 2 × s)
= Exp(2.3072 + 0.0003 × 1,826 – 2 × 0.0217)
= Exp(2.7963)
= $16.38
Description
- The secondary trend is increasing.
- The growth rate of the secondary trend is 11.23% per annum.
- T price at the close of May 20, 2024 was inside the secondary price channel.
- Discover a new approach to trend analysis.
- Check the power of mathematical statistics.
- Price channels have never been so accurately estimated.
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