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 56.97% per annum.
- ETN price at the close of January 29, 2025 was $317.60 and was lower than the bottom border of the primary price channel by $27.48 (7.96%). This indicates a possible reversal in the primary trend direction.
- The secondary trend is increasing.
- The growth rate of the secondary trend is 19.19% per annum.
- ETN price at the close of January 29, 2025 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 ETN 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 10, 2022
End date: December 17, 2024
a = 3.7276
b = 0.0012
s = 0.0697
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × 0.0012) – 1
= 56.97%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0697) – 1
= 32.17%
June 10, 2022 calculations
Top border of price channel:
Exp(Y596)
= Exp(a + b × X596 + 2 × s)
= Exp(a + b × 862 + 2 × s)
= Exp(3.7276 + 0.0012 × 862 + 2 × 0.0697)
= Exp(4.9319)
= $138.64
Bottom border of price channel:
Exp(Y596)
= Exp(a + b × X596 – 2 × s)
= Exp(a + b × 862 – 2 × s)
= Exp(3.7276 + 0.0012 × 862 – 2 × 0.0697)
= Exp(4.6530)
= $104.90
December 17, 2024 calculations
Top border of price channel:
Exp(Y1,229)
= Exp(a + b × X1,229 + 2 × s)
= Exp(a + b × 1,783 + 2 × s)
= Exp(3.7276 + 0.0012 × 1,783 + 2 × 0.0697)
= Exp(6.0696)
= $432.51
Bottom border of price channel:
Exp(Y1,229)
= Exp(a + b × X1,229 – 2 × s)
= Exp(a + b × 1,783 – 2 × s)
= Exp(3.7276 + 0.0012 × 1,783 – 2 × 0.0697)
= Exp(5.7907)
= $327.23
Description
- The primary trend is increasing.
- The growth rate of the primary trend is 56.97% per annum.
- ETN price at the close of January 29, 2025 was $317.60 and was lower than the bottom border of the primary price channel by $27.48 (7.96%). This indicates a possible reversal in the primary trend direction.
Secondary Trend
Start date: February 22, 2024
End date: January 29, 2025
a = 4.9804
b = 0.0005
s = 0.0597
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × 0.0005) – 1
= 19.19%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0597) – 1
= 26.95%
February 22, 2024 calculations
Top border of price channel:
Exp(Y1,022)
= Exp(a + b × X1,022 + 2 × s)
= Exp(a + b × 1,484 + 2 × s)
= Exp(4.9804 + 0.0005 × 1,484 + 2 × 0.0597)
= Exp(5.8135)
= $334.79
Bottom border of price channel:
Exp(Y1,022)
= Exp(a + b × X1,022 – 2 × s)
= Exp(a + b × 1,484 – 2 × s)
= Exp(4.9804 + 0.0005 × 1,484 – 2 × 0.0597)
= Exp(5.5749)
= $263.71
January 29, 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(4.9804 + 0.0005 × 1,826 + 2 × 0.0597)
= Exp(5.9780)
= $394.65
Bottom border of price channel:
Exp(Y1,256)
= Exp(a + b × X1,256 – 2 × s)
= Exp(a + b × 1,826 – 2 × s)
= Exp(4.9804 + 0.0005 × 1,826 – 2 × 0.0597)
= Exp(5.7394)
= $310.86
Description
- The secondary trend is increasing.
- The growth rate of the secondary trend is 19.19% per annum.
- ETN price at the close of January 29, 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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