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 13.94% per annum.
- SNPS price at the close of November 19, 2024 was $534.02 and was inside the primary price channel.
- The secondary trend is increasing.
- The growth rate of the secondary trend is 81.20% per annum.
- SNPS price at the close of November 19, 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 SNPS 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: February 2, 2024
End date: November 19, 2024
a = 6.9983
b = -0.0004
s = 0.0571
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × -0.0004) – 1
= -13.94%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0571) – 1
= 25.66%
February 2, 2024 calculations
Top border of price channel:
Exp(Y1,056)
= Exp(a + b × X1,056 + 2 × s)
= Exp(a + b × 1,535 + 2 × s)
= Exp(6.9983 + -0.0004 × 1,535 + 2 × 0.0571)
= Exp(6.4812)
= $652.78
Bottom border of price channel:
Exp(Y1,056)
= Exp(a + b × X1,056 – 2 × s)
= Exp(a + b × 1,535 – 2 × s)
= Exp(6.9983 + -0.0004 × 1,535 – 2 × 0.0571)
= Exp(6.2528)
= $519.47
November 19, 2024 calculations
Top border of price channel:
Exp(Y1,257)
= Exp(a + b × X1,257 + 2 × s)
= Exp(a + b × 1,826 + 2 × s)
= Exp(6.9983 + -0.0004 × 1,826 + 2 × 0.0571)
= Exp(6.3616)
= $579.15
Bottom border of price channel:
Exp(Y1,257)
= Exp(a + b × X1,257 – 2 × s)
= Exp(a + b × 1,826 – 2 × s)
= Exp(6.9983 + -0.0004 × 1,826 – 2 × 0.0571)
= Exp(6.1331)
= $460.88
Description
- The primary trend is decreasing.
- The decline rate of the primary trend is 13.94% per annum.
- SNPS price at the close of November 19, 2024 was $534.02 and was inside the primary price channel.
Secondary Trend
Start date: September 3, 2024
End date: November 19, 2024
a = 3.3265
b = 0.0016
s = 0.0321
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × 0.0016) – 1
= 81.20%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0321) – 1
= 13.71%
September 3, 2024 calculations
Top border of price channel:
Exp(Y1,202)
= Exp(a + b × X1,202 + 2 × s)
= Exp(a + b × 1,749 + 2 × s)
= Exp(3.3265 + 0.0016 × 1,749 + 2 × 0.0321)
= Exp(6.2391)
= $512.38
Bottom border of price channel:
Exp(Y1,202)
= Exp(a + b × X1,202 – 2 × s)
= Exp(a + b × 1,749 – 2 × s)
= Exp(3.3265 + 0.0016 × 1,749 – 2 × 0.0321)
= Exp(6.1105)
= $450.58
November 19, 2024 calculations
Top border of price channel:
Exp(Y1,257)
= Exp(a + b × X1,257 + 2 × s)
= Exp(a + b × 1,826 + 2 × s)
= Exp(3.3265 + 0.0016 × 1,826 + 2 × 0.0321)
= Exp(6.3645)
= $580.83
Bottom border of price channel:
Exp(Y1,257)
= Exp(a + b × X1,257 – 2 × s)
= Exp(a + b × 1,826 – 2 × s)
= Exp(3.3265 + 0.0016 × 1,826 – 2 × 0.0321)
= Exp(6.2359)
= $510.78
Description
- The secondary trend is increasing.
- The growth rate of the secondary trend is 81.20% per annum.
- SNPS price at the close of November 19, 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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