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 2.77% per annum.
- LOW price at the close of May 16, 2024 was $232.26 and was inside the primary price channel.
- The secondary trend is increasing.
- The growth rate of the secondary trend is 12.99% per annum.
- LOW price at the close of May 16, 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 LOW 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: March 25, 2021
End date: February 22, 2024
a = 5.2114
b = 0.0001
s = 0.0824
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × 0.0001) – 1
= 2.77%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0824) – 1
= 39.02%
March 25, 2021 calculations
Top border of price channel:
Exp(Y467)
= Exp(a + b × X467 + 2 × s)
= Exp(a + b × 678 + 2 × s)
= Exp(5.2114 + 0.0001 × 678 + 2 × 0.0824)
= Exp(5.4270)
= $227.46
Bottom border of price channel:
Exp(Y467)
= Exp(a + b × X467 – 2 × s)
= Exp(a + b × 678 – 2 × s)
= Exp(5.2114 + 0.0001 × 678 – 2 × 0.0824)
= Exp(5.0976)
= $163.62
February 22, 2024 calculations
Top border of price channel:
Exp(Y1,199)
= Exp(a + b × X1,199 + 2 × s)
= Exp(a + b × 1,742 + 2 × s)
= Exp(5.2114 + 0.0001 × 1,742 + 2 × 0.0824)
= Exp(5.5068)
= $246.36
Bottom border of price channel:
Exp(Y1,199)
= Exp(a + b × X1,199 – 2 × s)
= Exp(a + b × 1,742 – 2 × s)
= Exp(5.2114 + 0.0001 × 1,742 – 2 × 0.0824)
= Exp(5.1773)
= $177.21
Description
- The primary trend is increasing.
- The growth rate of the primary trend is 2.77% per annum.
- LOW price at the close of May 16, 2024 was $232.26 and was inside the primary price channel.
Secondary Trend
Start date: May 5, 2022
End date: May 16, 2024
a = 4.8296
b = 0.0003
s = 0.0557
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × 0.0003) – 1
= 12.99%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0557) – 1
= 24.95%
May 5, 2022 calculations
Top border of price channel:
Exp(Y748)
= Exp(a + b × X748 + 2 × s)
= Exp(a + b × 1,084 + 2 × s)
= Exp(4.8296 + 0.0003 × 1,084 + 2 × 0.0557)
= Exp(5.3037)
= $201.09
Bottom border of price channel:
Exp(Y748)
= Exp(a + b × X748 – 2 × s)
= Exp(a + b × 1,084 – 2 × s)
= Exp(4.8296 + 0.0003 × 1,084 – 2 × 0.0557)
= Exp(5.0810)
= $160.93
May 16, 2024 calculations
Top border of price channel:
Exp(Y1,258)
= Exp(a + b × X1,258 + 2 × s)
= Exp(a + b × 1,826 + 2 × s)
= Exp(4.8296 + 0.0003 × 1,826 + 2 × 0.0557)
= Exp(5.5520)
= $257.76
Bottom border of price channel:
Exp(Y1,258)
= Exp(a + b × X1,258 – 2 × s)
= Exp(a + b × 1,826 – 2 × s)
= Exp(4.8296 + 0.0003 × 1,826 – 2 × 0.0557)
= Exp(5.3293)
= $206.29
Description
- The secondary trend is increasing.
- The growth rate of the secondary trend is 12.99% per annum.
- LOW price at the close of May 16, 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.
Check out LOW and 1,499 other stocks on our new website