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 22.67% per annum.
- ABNB price at the close of November 20, 2024 was $135.25 and was lower than the bottom border of the primary price channel by $2.09 (1.52%). This indicates a possible reversal in the primary trend direction.
- The secondary trend is decreasing.
- The decline rate of the secondary trend is 40.52% per annum.
- ABNB price at the close of November 20, 2024 was higher than the top border of the secondary price channel by $5.43 (4.18%). This indicates a possible reversal in the secondary trend direction.
- 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 ABNB 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: May 10, 2022
End date: July 31, 2024
a = 4.3101
b = 0.0006
s = 0.0972
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × 0.0006) – 1
= 22.67%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0972) – 1
= 47.54%
May 10, 2022 calculations
Top border of price channel:
Exp(Y355)
= Exp(a + b × X355 + 2 × s)
= Exp(a + b × 516 + 2 × s)
= Exp(4.3101 + 0.0006 × 516 + 2 × 0.0972)
= Exp(4.7934)
= $120.72
Bottom border of price channel:
Exp(Y355)
= Exp(a + b × X355 – 2 × s)
= Exp(a + b × 516 – 2 × s)
= Exp(4.3101 + 0.0006 × 516 – 2 × 0.0972)
= Exp(4.4045)
= $81.82
July 31, 2024 calculations
Top border of price channel:
Exp(Y913)
= Exp(a + b × X913 + 2 × s)
= Exp(a + b × 1,329 + 2 × s)
= Exp(4.3101 + 0.0006 × 1,329 + 2 × 0.0972)
= Exp(5.2487)
= $190.31
Bottom border of price channel:
Exp(Y913)
= Exp(a + b × X913 – 2 × s)
= Exp(a + b × 1,329 – 2 × s)
= Exp(4.3101 + 0.0006 × 1,329 – 2 × 0.0972)
= Exp(4.8597)
= $128.99
Description
- The primary trend is increasing.
- The growth rate of the primary trend is 22.67% per annum.
- ABNB price at the close of November 20, 2024 was $135.25 and was lower than the bottom border of the primary price channel by $2.09 (1.52%). This indicates a possible reversal in the primary trend direction.
Secondary Trend
Start date: February 12, 2024
End date: October 7, 2024
a = 6.7842
b = -0.0014
s = 0.0664
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × -0.0014) – 1
= -40.52%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0664) – 1
= 30.44%
February 12, 2024 calculations
Top border of price channel:
Exp(Y796)
= Exp(a + b × X796 + 2 × s)
= Exp(a + b × 1,159 + 2 × s)
= Exp(6.7842 + -0.0014 × 1,159 + 2 × 0.0664)
= Exp(5.2675)
= $193.93
Bottom border of price channel:
Exp(Y796)
= Exp(a + b × X796 – 2 × s)
= Exp(a + b × 1,159 – 2 × s)
= Exp(6.7842 + -0.0014 × 1,159 – 2 × 0.0664)
= Exp(5.0017)
= $148.67
October 7, 2024 calculations
Top border of price channel:
Exp(Y960)
= Exp(a + b × X960 + 2 × s)
= Exp(a + b × 1,397 + 2 × s)
= Exp(6.7842 + -0.0014 × 1,397 + 2 × 0.0664)
= Exp(4.9288)
= $138.21
Bottom border of price channel:
Exp(Y960)
= Exp(a + b × X960 – 2 × s)
= Exp(a + b × 1,397 – 2 × s)
= Exp(6.7842 + -0.0014 × 1,397 – 2 × 0.0664)
= Exp(4.6630)
= $105.95
Description
- The secondary trend is decreasing.
- The decline rate of the secondary trend is 40.52% per annum.
- ABNB price at the close of November 20, 2024 was higher than the top border of the secondary price channel by $5.43 (4.18%). This indicates a possible reversal in the secondary trend direction.
- Discover a new approach to trend analysis.
- Check the power of mathematical statistics.
- Price channels have never been so accurately estimated.
Check out ABNB and 1,499 other stocks on our new website