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 46.62% per annum.
- CCL price at the close of May 16, 2024 was $14.90 and was inside the primary price channel.
- The secondary trend is decreasing.
- The decline rate of the secondary trend is 40.76% per annum.
- CCL price at the close of May 16, 2024 was inside the secondary price channel.
- The direction of the secondary trend is opposite to the direction of the primary trend. This indicates a possible reversal in the direction of the primary trend.
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 CCL 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: June 13, 2022
End date: May 16, 2024
a = 0.9513
b = 0.0010
s = 0.1639
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × 0.0010) – 1
= 46.62%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.1639) – 1
= 92.61%
June 13, 2022 calculations
Top border of price channel:
Exp(Y774)
= Exp(a + b × X774 + 2 × s)
= Exp(a + b × 1,123 + 2 × s)
= Exp(0.9513 + 0.0010 × 1,123 + 2 × 0.1639)
= Exp(2.4565)
= $11.66
Bottom border of price channel:
Exp(Y774)
= Exp(a + b × X774 – 2 × s)
= Exp(a + b × 1,123 – 2 × s)
= Exp(0.9513 + 0.0010 × 1,123 – 2 × 0.1639)
= Exp(1.8010)
= $6.06
May 16, 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(0.9513 + 0.0010 × 1,826 + 2 × 0.1639)
= Exp(3.1935)
= $24.37
Bottom border of price channel:
Exp(Y1,258)
= Exp(a + b × X1,258 – 2 × s)
= Exp(a + b × 1,826 – 2 × s)
= Exp(0.9513 + 0.0010 × 1,826 – 2 × 0.1639)
= Exp(2.5380)
= $12.65
Description
- The primary trend is increasing.
- The growth rate of the primary trend is 46.62% per annum.
- CCL price at the close of May 16, 2024 was $14.90 and was inside the primary price channel.
Secondary Trend
Start date: December 6, 2023
End date: May 16, 2024
a = 5.2820
b = -0.0014
s = 0.0461
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × -0.0014) – 1
= -40.76%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0461) – 1
= 20.24%
December 6, 2023 calculations
Top border of price channel:
Exp(Y1,147)
= Exp(a + b × X1,147 + 2 × s)
= Exp(a + b × 1,664 + 2 × s)
= Exp(5.2820 + -0.0014 × 1,664 + 2 × 0.0461)
= Exp(2.9874)
= $19.83
Bottom border of price channel:
Exp(Y1,147)
= Exp(a + b × X1,147 – 2 × s)
= Exp(a + b × 1,664 – 2 × s)
= Exp(5.2820 + -0.0014 × 1,664 – 2 × 0.0461)
= Exp(2.8030)
= $16.49
May 16, 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(5.2820 + -0.0014 × 1,826 + 2 × 0.0461)
= Exp(2.7550)
= $15.72
Bottom border of price channel:
Exp(Y1,258)
= Exp(a + b × X1,258 – 2 × s)
= Exp(a + b × 1,826 – 2 × s)
= Exp(5.2820 + -0.0014 × 1,826 – 2 × 0.0461)
= Exp(2.5707)
= $13.07
Description
- The secondary trend is decreasing.
- The decline rate of the secondary trend is 40.76% per annum.
- CCL price at the close of May 16, 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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