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 86.56% per annum.
- ANET price at the close of February 20, 2025 was $103.40 and was lower than the bottom border of the primary price channel by $0.80 (0.76%). This indicates a possible reversal in the primary trend direction.
- The secondary trend is increasing.
- The growth rate of the secondary trend is 95.32% per annum.
- ANET price at the close of February 20, 2025 was lower than the bottom border of the secondary price channel by $6.20 (5.66%). 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 ANET 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: September 19, 2022
End date: February 18, 2025
a = 1.6684
b = 0.0017
s = 0.0709
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × 0.0017) – 1
= 86.56%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0709) – 1
= 32.77%
September 19, 2022 calculations
Top border of price channel:
Exp(Y649)
= Exp(a + b × X649 + 2 × s)
= Exp(a + b × 941 + 2 × s)
= Exp(1.6684 + 0.0017 × 941 + 2 × 0.0709)
= Exp(3.4178)
= $30.50
Bottom border of price channel:
Exp(Y649)
= Exp(a + b × X649 – 2 × s)
= Exp(a + b × 941 – 2 × s)
= Exp(1.6684 + 0.0017 × 941 – 2 × 0.0709)
= Exp(3.1343)
= $22.97
February 18, 2025 calculations
Top border of price channel:
Exp(Y1,254)
= Exp(a + b × X1,254 + 2 × s)
= Exp(a + b × 1,824 + 2 × s)
= Exp(1.6684 + 0.0017 × 1,824 + 2 × 0.0709)
= Exp(4.9263)
= $137.87
Bottom border of price channel:
Exp(Y1,254)
= Exp(a + b × X1,254 – 2 × s)
= Exp(a + b × 1,824 – 2 × s)
= Exp(1.6684 + 0.0017 × 1,824 – 2 × 0.0709)
= Exp(4.6428)
= $103.84
Description
- The primary trend is increasing.
- The growth rate of the primary trend is 86.56% per annum.
- ANET price at the close of February 20, 2025 was $103.40 and was lower than the bottom border of the primary price channel by $0.80 (0.76%). This indicates a possible reversal in the primary trend direction.
Secondary Trend
Start date: May 2, 2023
End date: February 18, 2025
a = 1.4705
b = 0.0018
s = 0.0614
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × 0.0018) – 1
= 95.32%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0614) – 1
= 27.82%
May 2, 2023 calculations
Top border of price channel:
Exp(Y804)
= Exp(a + b × X804 + 2 × s)
= Exp(a + b × 1,166 + 2 × s)
= Exp(1.4705 + 0.0018 × 1,166 + 2 × 0.0614)
= Exp(3.7318)
= $41.75
Bottom border of price channel:
Exp(Y804)
= Exp(a + b × X804 – 2 × s)
= Exp(a + b × 1,166 – 2 × s)
= Exp(1.4705 + 0.0018 × 1,166 – 2 × 0.0614)
= Exp(3.4864)
= $32.67
February 18, 2025 calculations
Top border of price channel:
Exp(Y1,254)
= Exp(a + b × X1,254 + 2 × s)
= Exp(a + b × 1,824 + 2 × s)
= Exp(1.4705 + 0.0018 × 1,824 + 2 × 0.0614)
= Exp(4.9387)
= $139.58
Bottom border of price channel:
Exp(Y1,254)
= Exp(a + b × X1,254 – 2 × s)
= Exp(a + b × 1,824 – 2 × s)
= Exp(1.4705 + 0.0018 × 1,824 – 2 × 0.0614)
= Exp(4.6932)
= $109.20
Description
- The secondary trend is increasing.
- The growth rate of the secondary trend is 95.32% per annum.
- ANET price at the close of February 20, 2025 was lower than the bottom border of the secondary price channel by $6.20 (5.66%). 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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