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 77.18% per annum.
- KO price at the close of November 19, 2024 was $62.59 and was higher than the top border of the primary price channel by $0.47 (0.75%). This indicates a possible reversal in the primary trend direction.
- The secondary trend is decreasing.
- The decline rate of the secondary trend is 68.83% per annum.
- KO price at the close of November 19, 2024 was inside the secondary price channel.
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 KO 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: October 14, 2024
End date: November 18, 2024
a = 11.5049
b = -0.0040
s = 0.0084
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × -0.0040) – 1
= -77.18%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0084) – 1
= 3.43%
October 14, 2024 calculations
Top border of price channel:
Exp(Y1,231)
= Exp(a + b × X1,231 + 2 × s)
= Exp(a + b × 1,790 + 2 × s)
= Exp(11.5049 + -0.0040 × 1,790 + 2 × 0.0084)
= Exp(4.2749)
= $71.87
Bottom border of price channel:
Exp(Y1,231)
= Exp(a + b × X1,231 – 2 × s)
= Exp(a + b × 1,790 – 2 × s)
= Exp(11.5049 + -0.0040 × 1,790 – 2 × 0.0084)
= Exp(4.2411)
= $69.49
November 18, 2024 calculations
Top border of price channel:
Exp(Y1,256)
= Exp(a + b × X1,256 + 2 × s)
= Exp(a + b × 1,825 + 2 × s)
= Exp(11.5049 + -0.0040 × 1,825 + 2 × 0.0084)
= Exp(4.1332)
= $62.38
Bottom border of price channel:
Exp(Y1,256)
= Exp(a + b × X1,256 – 2 × s)
= Exp(a + b × 1,825 – 2 × s)
= Exp(11.5049 + -0.0040 × 1,825 – 2 × 0.0084)
= Exp(4.0994)
= $60.31
Description
- The primary trend is decreasing.
- The decline rate of the primary trend is 77.18% per annum.
- KO price at the close of November 19, 2024 was $62.59 and was higher than the top border of the primary price channel by $0.47 (0.75%). This indicates a possible reversal in the primary trend direction.
Secondary Trend
Start date: October 24, 2024
End date: November 19, 2024
a = 9.9547
b = -0.0032
s = 0.0071
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × -0.0032) – 1
= -68.83%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0071) – 1
= 2.90%
October 24, 2024 calculations
Top border of price channel:
Exp(Y1,239)
= Exp(a + b × X1,239 + 2 × s)
= Exp(a + b × 1,800 + 2 × s)
= Exp(9.9547 + -0.0032 × 1,800 + 2 × 0.0071)
= Exp(4.2199)
= $68.03
Bottom border of price channel:
Exp(Y1,239)
= Exp(a + b × X1,239 – 2 × s)
= Exp(a + b × 1,800 – 2 × s)
= Exp(9.9547 + -0.0032 × 1,800 – 2 × 0.0071)
= Exp(4.1913)
= $66.11
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(9.9547 + -0.0032 × 1,826 + 2 × 0.0071)
= Exp(4.1369)
= $62.61
Bottom border of price channel:
Exp(Y1,257)
= Exp(a + b × X1,257 – 2 × s)
= Exp(a + b × 1,826 – 2 × s)
= Exp(9.9547 + -0.0032 × 1,826 – 2 × 0.0071)
= Exp(4.1083)
= $60.84
Description
- The secondary trend is decreasing.
- The decline rate of the secondary trend is 68.83% per annum.
- KO 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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