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 198.19% per annum.
- TSLA price at the close of February 20, 2025 was $354.40 and was inside the primary price channel.
- The secondary trend is decreasing.
- The decline rate of the secondary trend is 72.66% per annum.
- TSLA price at the close of February 20, 2025 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 TSLA 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: March 13, 2024
End date: February 20, 2025
a = 0.5548
b = 0.0030
s = 0.1277
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × 0.0030) – 1
= 198.19%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.1277) – 1
= 66.68%
March 13, 2024 calculations
Top border of price channel:
Exp(Y1,021)
= Exp(a + b × X1,021 + 2 × s)
= Exp(a + b × 1,482 + 2 × s)
= Exp(0.5548 + 0.0030 × 1,482 + 2 × 0.1277)
= Exp(5.2463)
= $189.87
Bottom border of price channel:
Exp(Y1,021)
= Exp(a + b × X1,021 – 2 × s)
= Exp(a + b × 1,482 – 2 × s)
= Exp(0.5548 + 0.0030 × 1,482 – 2 × 0.1277)
= Exp(4.7354)
= $113.91
February 20, 2025 calculations
Top border of price channel:
Exp(Y1,256)
= Exp(a + b × X1,256 + 2 × s)
= Exp(a + b × 1,826 + 2 × s)
= Exp(0.5548 + 0.0030 × 1,826 + 2 × 0.1277)
= Exp(6.2760)
= $531.67
Bottom border of price channel:
Exp(Y1,256)
= Exp(a + b × X1,256 – 2 × s)
= Exp(a + b × 1,826 – 2 × s)
= Exp(0.5548 + 0.0030 × 1,826 – 2 × 0.1277)
= Exp(5.7651)
= $318.98
Description
- The primary trend is increasing.
- The growth rate of the primary trend is 198.19% per annum.
- TSLA price at the close of February 20, 2025 was $354.40 and was inside the primary price channel.
Secondary Trend
Start date: December 13, 2024
End date: February 20, 2025
a = 12.3598
b = -0.0036
s = 0.0462
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × -0.0036) – 1
= -72.66%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0462) – 1
= 20.31%
December 13, 2024 calculations
Top border of price channel:
Exp(Y1,212)
= Exp(a + b × X1,212 + 2 × s)
= Exp(a + b × 1,757 + 2 × s)
= Exp(12.3598 + -0.0036 × 1,757 + 2 × 0.0462)
= Exp(6.2096)
= $497.50
Bottom border of price channel:
Exp(Y1,212)
= Exp(a + b × X1,212 – 2 × s)
= Exp(a + b × 1,757 – 2 × s)
= Exp(12.3598 + -0.0036 × 1,757 – 2 × 0.0462)
= Exp(6.0247)
= $413.52
February 20, 2025 calculations
Top border of price channel:
Exp(Y1,256)
= Exp(a + b × X1,256 + 2 × s)
= Exp(a + b × 1,826 + 2 × s)
= Exp(12.3598 + -0.0036 × 1,826 + 2 × 0.0462)
= Exp(5.9644)
= $389.34
Bottom border of price channel:
Exp(Y1,256)
= Exp(a + b × X1,256 – 2 × s)
= Exp(a + b × 1,826 – 2 × s)
= Exp(12.3598 + -0.0036 × 1,826 – 2 × 0.0462)
= Exp(5.7795)
= $323.61
Description
- The secondary trend is decreasing.
- The decline rate of the secondary trend is 72.66% per annum.
- TSLA price at the close of February 20, 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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