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 35.76% per annum.
- DG price at the close of November 19, 2024 was $76.50 and was inside the primary price channel.
- The secondary trend is decreasing.
- The decline rate of the secondary trend is 67.35% per annum.
- DG 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 DG 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: June 21, 2022
End date: November 19, 2024
a = 6.7370
b = -0.0012
s = 0.1463
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × -0.0012) – 1
= -35.76%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.1463) – 1
= 79.54%
June 21, 2022 calculations
Top border of price channel:
Exp(Y649)
= Exp(a + b × X649 + 2 × s)
= Exp(a + b × 944 + 2 × s)
= Exp(6.7370 + -0.0012 × 944 + 2 × 0.1463)
= Exp(5.8851)
= $359.65
Bottom border of price channel:
Exp(Y649)
= Exp(a + b × X649 – 2 × s)
= Exp(a + b × 944 – 2 × s)
= Exp(6.7370 + -0.0012 × 944 – 2 × 0.1463)
= Exp(5.2999)
= $200.31
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(6.7370 + -0.0012 × 1,826 + 2 × 0.1463)
= Exp(4.8158)
= $123.45
Bottom border of price channel:
Exp(Y1,257)
= Exp(a + b × X1,257 – 2 × s)
= Exp(a + b × 1,826 – 2 × s)
= Exp(6.7370 + -0.0012 × 1,826 – 2 × 0.1463)
= Exp(4.2306)
= $68.76
Description
- The primary trend is decreasing.
- The decline rate of the primary trend is 35.76% per annum.
- DG price at the close of November 19, 2024 was $76.50 and was inside the primary price channel.
Secondary Trend
Start date: March 6, 2024
End date: November 19, 2024
a = 9.9424
b = -0.0031
s = 0.0852
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × -0.0031) – 1
= -67.35%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0852) – 1
= 40.63%
March 6, 2024 calculations
Top border of price channel:
Exp(Y1,078)
= Exp(a + b × X1,078 + 2 × s)
= Exp(a + b × 1,568 + 2 × s)
= Exp(9.9424 + -0.0031 × 1,568 + 2 × 0.0852)
= Exp(5.3049)
= $201.31
Bottom border of price channel:
Exp(Y1,078)
= Exp(a + b × X1,078 – 2 × s)
= Exp(a + b × 1,568 – 2 × s)
= Exp(9.9424 + -0.0031 × 1,568 – 2 × 0.0852)
= Exp(4.9639)
= $143.15
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(9.9424 + -0.0031 × 1,826 + 2 × 0.0852)
= Exp(4.5137)
= $91.26
Bottom border of price channel:
Exp(Y1,257)
= Exp(a + b × X1,257 – 2 × s)
= Exp(a + b × 1,826 – 2 × s)
= Exp(9.9424 + -0.0031 × 1,826 – 2 × 0.0852)
= Exp(4.1728)
= $64.90
Description
- The secondary trend is decreasing.
- The decline rate of the secondary trend is 67.35% per annum.
- DG 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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