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 1.58% per annum.
- TXN price at the close of January 17, 2025 was $192.42 and was higher than the top border of the primary price channel by $16.88 (9.61%). This indicates a possible reversal in the primary trend direction.
- The secondary trend is increasing.
- The growth rate of the secondary trend is 40.79% per annum.
- TXN price at the close of January 17, 2025 was lower than the bottom border of the secondary price channel by $15.72 (7.55%). 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 TXN 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: January 7, 2021
End date: April 23, 2024
a = 5.1328
b = 0.0000
s = 0.0574
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × 0.0000) – 1
= -1.58%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0574) – 1
= 25.81%
January 7, 2021 calculations
Top border of price channel:
Exp(Y244)
= Exp(a + b × X244 + 2 × s)
= Exp(a + b × 352 + 2 × s)
= Exp(5.1328 + 0.0000 × 352 + 2 × 0.0574)
= Exp(5.2322)
= $187.20
Bottom border of price channel:
Exp(Y244)
= Exp(a + b × X244 – 2 × s)
= Exp(a + b × 352 – 2 × s)
= Exp(5.1328 + 0.0000 × 352 – 2 × 0.0574)
= Exp(5.0025)
= $148.79
April 23, 2024 calculations
Top border of price channel:
Exp(Y1,071)
= Exp(a + b × X1,071 + 2 × s)
= Exp(a + b × 1,554 + 2 × s)
= Exp(5.1328 + 0.0000 × 1,554 + 2 × 0.0574)
= Exp(5.1796)
= $177.62
Bottom border of price channel:
Exp(Y1,071)
= Exp(a + b × X1,071 – 2 × s)
= Exp(a + b × 1,554 – 2 × s)
= Exp(5.1328 + 0.0000 × 1,554 – 2 × 0.0574)
= Exp(4.9500)
= $141.18
Description
- The primary trend is decreasing.
- The decline rate of the primary trend is 1.58% per annum.
- TXN price at the close of January 17, 2025 was $192.42 and was higher than the top border of the primary price channel by $16.88 (9.61%). This indicates a possible reversal in the primary trend direction.
Secondary Trend
Start date: September 15, 2023
End date: November 18, 2024
a = 3.7150
b = 0.0009
s = 0.0426
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × 0.0009) – 1
= 40.79%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0426) – 1
= 18.60%
September 15, 2023 calculations
Top border of price channel:
Exp(Y920)
= Exp(a + b × X920 + 2 × s)
= Exp(a + b × 1,333 + 2 × s)
= Exp(3.7150 + 0.0009 × 1,333 + 2 × 0.0426)
= Exp(5.0496)
= $155.95
Bottom border of price channel:
Exp(Y920)
= Exp(a + b × X920 – 2 × s)
= Exp(a + b × 1,333 – 2 × s)
= Exp(3.7150 + 0.0009 × 1,333 – 2 × 0.0426)
= Exp(4.8790)
= $131.50
November 18, 2024 calculations
Top border of price channel:
Exp(Y1,216)
= Exp(a + b × X1,216 + 2 × s)
= Exp(a + b × 1,763 + 2 × s)
= Exp(3.7150 + 0.0009 × 1,763 + 2 × 0.0426)
= Exp(5.4526)
= $233.35
Bottom border of price channel:
Exp(Y1,216)
= Exp(a + b × X1,216 – 2 × s)
= Exp(a + b × 1,763 – 2 × s)
= Exp(3.7150 + 0.0009 × 1,763 – 2 × 0.0426)
= Exp(5.2820)
= $196.76
Description
- The secondary trend is increasing.
- The growth rate of the secondary trend is 40.79% per annum.
- TXN price at the close of January 17, 2025 was lower than the bottom border of the secondary price channel by $15.72 (7.55%). 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 TXN and 1,499 other stocks on our new website