Stock Price Trends
Stock price trends estimated using linear regression.
Summary
Key facts
- The primary trend is decreasing.
- The decline rate of the primary trend is 10.15% per annum.
- ADI price at the close of January 17, 2025 was $219.16 and was inside the primary price channel.
- The secondary trend is decreasing.
- The decline rate of the secondary trend is 21.63% per annum.
- ADI price at the close of January 17, 2025 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 ADI 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 22, 2024
End date: January 17, 2025
a = 5.9054
b = -0.0003
s = 0.0313
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × -0.0003) – 1
= -10.15%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0313) – 1
= 13.34%
May 22, 2024 calculations
Top border of price channel:
Exp(Y1,092)
= Exp(a + b × X1,092 + 2 × s)
= Exp(a + b × 1,583 + 2 × s)
= Exp(5.9054 + -0.0003 × 1,583 + 2 × 0.0313)
= Exp(5.5040)
= $245.68
Bottom border of price channel:
Exp(Y1,092)
= Exp(a + b × X1,092 – 2 × s)
= Exp(a + b × 1,583 – 2 × s)
= Exp(5.9054 + -0.0003 × 1,583 – 2 × 0.0313)
= Exp(5.3788)
= $216.76
January 17, 2025 calculations
Top border of price channel:
Exp(Y1,256)
= Exp(a + b × X1,256 + 2 × s)
= Exp(a + b × 1,823 + 2 × s)
= Exp(5.9054 + -0.0003 × 1,823 + 2 × 0.0313)
= Exp(5.4337)
= $228.99
Bottom border of price channel:
Exp(Y1,256)
= Exp(a + b × X1,256 – 2 × s)
= Exp(a + b × 1,823 – 2 × s)
= Exp(5.9054 + -0.0003 × 1,823 – 2 × 0.0313)
= Exp(5.3084)
= $202.04
Description
- The primary trend is decreasing.
- The decline rate of the primary trend is 10.15% per annum.
- ADI price at the close of January 17, 2025 was $219.16 and was inside the primary price channel.
Secondary Trend
Start date: September 19, 2024
End date: January 17, 2025
a = 6.5720
b = -0.0007
s = 0.0222
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × -0.0007) – 1
= -21.63%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0222) – 1
= 9.31%
September 19, 2024 calculations
Top border of price channel:
Exp(Y1,174)
= Exp(a + b × X1,174 + 2 × s)
= Exp(a + b × 1,703 + 2 × s)
= Exp(6.5720 + -0.0007 × 1,703 + 2 × 0.0222)
= Exp(5.4793)
= $239.69
Bottom border of price channel:
Exp(Y1,174)
= Exp(a + b × X1,174 – 2 × s)
= Exp(a + b × 1,703 – 2 × s)
= Exp(6.5720 + -0.0007 × 1,703 – 2 × 0.0222)
= Exp(5.3904)
= $219.28
January 17, 2025 calculations
Top border of price channel:
Exp(Y1,256)
= Exp(a + b × X1,256 + 2 × s)
= Exp(a + b × 1,823 + 2 × s)
= Exp(6.5720 + -0.0007 × 1,823 + 2 × 0.0222)
= Exp(5.3992)
= $221.23
Bottom border of price channel:
Exp(Y1,256)
= Exp(a + b × X1,256 – 2 × s)
= Exp(a + b × 1,823 – 2 × s)
= Exp(6.5720 + -0.0007 × 1,823 – 2 × 0.0222)
= Exp(5.3102)
= $202.40
Description
- The secondary trend is decreasing.
- The decline rate of the secondary trend is 21.63% per annum.
- ADI price at the close of January 17, 2025 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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