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 43.51% per annum.
- ORCL price at the close of February 20, 2025 was $176.00 and was inside the primary price channel.
- The secondary trend is increasing.
- The growth rate of the secondary trend is 68.82% per annum.
- ORCL price at the close of February 20, 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 ORCL 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: May 5, 2022
End date: February 20, 2025
a = 3.3666
b = 0.0010
s = 0.0863
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × 0.0010) – 1
= 43.51%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0863) – 1
= 41.22%
May 5, 2022 calculations
Top border of price channel:
Exp(Y556)
= Exp(a + b × X556 + 2 × s)
= Exp(a + b × 804 + 2 × s)
= Exp(3.3666 + 0.0010 × 804 + 2 × 0.0863)
= Exp(4.3348)
= $76.31
Bottom border of price channel:
Exp(Y556)
= Exp(a + b × X556 – 2 × s)
= Exp(a + b × 804 – 2 × s)
= Exp(3.3666 + 0.0010 × 804 – 2 × 0.0863)
= Exp(3.9897)
= $54.04
February 20, 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(3.3666 + 0.0010 × 1,826 + 2 × 0.0863)
= Exp(5.3462)
= $209.81
Bottom border of price channel:
Exp(Y1,256)
= Exp(a + b × X1,256 – 2 × s)
= Exp(a + b × 1,826 – 2 × s)
= Exp(3.3666 + 0.0010 × 1,826 – 2 × 0.0863)
= Exp(5.0011)
= $148.57
Description
- The primary trend is increasing.
- The growth rate of the primary trend is 43.51% per annum.
- ORCL price at the close of February 20, 2025 was $176.00 and was inside the primary price channel.
Secondary Trend
Start date: December 12, 2023
End date: February 20, 2025
a = 2.6270
b = 0.0014
s = 0.0689
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × 0.0014) – 1
= 68.82%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0689) – 1
= 31.74%
December 12, 2023 calculations
Top border of price channel:
Exp(Y959)
= Exp(a + b × X959 + 2 × s)
= Exp(a + b × 1,390 + 2 × s)
= Exp(2.6270 + 0.0014 × 1,390 + 2 × 0.0689)
= Exp(4.7591)
= $116.65
Bottom border of price channel:
Exp(Y959)
= Exp(a + b × X959 – 2 × s)
= Exp(a + b × 1,390 – 2 × s)
= Exp(2.6270 + 0.0014 × 1,390 – 2 × 0.0689)
= Exp(4.4835)
= $88.54
February 20, 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(2.6270 + 0.0014 × 1,826 + 2 × 0.0689)
= Exp(5.3847)
= $218.04
Bottom border of price channel:
Exp(Y1,256)
= Exp(a + b × X1,256 – 2 × s)
= Exp(a + b × 1,826 – 2 × s)
= Exp(2.6270 + 0.0014 × 1,826 – 2 × 0.0689)
= Exp(5.1090)
= $165.51
Description
- The secondary trend is increasing.
- The growth rate of the secondary trend is 68.82% per annum.
- ORCL price at the close of February 20, 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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