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 13.46% per annum.
- SNPS price at the close of January 17, 2025 was $526.70 and was inside the primary price channel.
- The secondary trend is decreasing.
- The decline rate of the secondary trend is 52.04% per annum.
- SNPS price at the close of January 17, 2025 was higher than the top border of the secondary price channel by $5.05 (0.97%). This indicates a possible reversal in the secondary trend direction.
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: January 17, 2025
a = 6.9493
b = -0.0004
s = 0.0561
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × -0.0004) – 1
= -13.46%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0561) – 1
= 25.13%
February 2, 2024 calculations
Top border of price channel:
Exp(Y1,016)
= Exp(a + b × X1,016 + 2 × s)
= Exp(a + b × 1,473 + 2 × s)
= Exp(6.9493 + -0.0004 × 1,473 + 2 × 0.0561)
= Exp(6.4781)
= $650.76
Bottom border of price channel:
Exp(Y1,016)
= Exp(a + b × X1,016 – 2 × s)
= Exp(a + b × 1,473 – 2 × s)
= Exp(6.9493 + -0.0004 × 1,473 – 2 × 0.0561)
= Exp(6.2539)
= $520.05
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(6.9493 + -0.0004 × 1,823 + 2 × 0.0561)
= Exp(6.3396)
= $566.55
Bottom border of price channel:
Exp(Y1,256)
= Exp(a + b × X1,256 – 2 × s)
= Exp(a + b × 1,823 – 2 × s)
= Exp(6.9493 + -0.0004 × 1,823 – 2 × 0.0561)
= Exp(6.1153)
= $452.75
Description
- The primary trend is decreasing.
- The decline rate of the primary trend is 13.46% per annum.
- SNPS price at the close of January 17, 2025 was $526.70 and was inside the primary price channel.
Secondary Trend
Start date: November 6, 2024
End date: January 17, 2025
a = 9.8539
b = -0.0020
s = 0.0363
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × -0.0020) – 1
= -52.04%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0363) – 1
= 15.64%
November 6, 2024 calculations
Top border of price channel:
Exp(Y1,208)
= Exp(a + b × X1,208 + 2 × s)
= Exp(a + b × 1,751 + 2 × s)
= Exp(9.8539 + -0.0020 × 1,751 + 2 × 0.0363)
= Exp(6.4019)
= $603.01
Bottom border of price channel:
Exp(Y1,208)
= Exp(a + b × X1,208 – 2 × s)
= Exp(a + b × 1,751 – 2 × s)
= Exp(9.8539 + -0.0020 × 1,751 – 2 × 0.0363)
= Exp(6.2566)
= $521.45
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(9.8539 + -0.0020 × 1,823 + 2 × 0.0363)
= Exp(6.2570)
= $521.65
Bottom border of price channel:
Exp(Y1,256)
= Exp(a + b × X1,256 – 2 × s)
= Exp(a + b × 1,823 – 2 × s)
= Exp(9.8539 + -0.0020 × 1,823 – 2 × 0.0363)
= Exp(6.1117)
= $451.10
Description
- The secondary trend is decreasing.
- The decline rate of the secondary trend is 52.04% per annum.
- SNPS price at the close of January 17, 2025 was higher than the top border of the secondary price channel by $5.05 (0.97%). 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.
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