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 99.16% per annum.
- AVGO price at the close of May 8, 2024 was $1,325.37 and was inside the primary price channel.
- The secondary trend is decreasing.
- The decline rate of the secondary trend is 11.57% per annum.
- AVGO price at the close of May 8, 2024 was inside the secondary price channel.
- The direction of the secondary trend is opposite to the direction of the primary trend. This indicates a possible reversal in the direction of the primary trend.
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 AVGO 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: September 20, 2022
End date: May 8, 2024
a = 3.7903
b = 0.0019
s = 0.0684
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × 0.0019) – 1
= 99.16%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0684) – 1
= 31.47%
September 20, 2022 calculations
Top border of price channel:
Exp(Y848)
= Exp(a + b × X848 + 2 × s)
= Exp(a + b × 1,230 + 2 × s)
= Exp(3.7903 + 0.0019 × 1,230 + 2 × 0.0684)
= Exp(6.2487)
= $517.34
Bottom border of price channel:
Exp(Y848)
= Exp(a + b × X848 – 2 × s)
= Exp(a + b × 1,230 – 2 × s)
= Exp(3.7903 + 0.0019 × 1,230 – 2 × 0.0684)
= Exp(5.9751)
= $393.49
May 8, 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(3.7903 + 0.0019 × 1,826 + 2 × 0.0684)
= Exp(7.3736)
= $1,593.39
Bottom border of price channel:
Exp(Y1,258)
= Exp(a + b × X1,258 – 2 × s)
= Exp(a + b × 1,826 – 2 × s)
= Exp(3.7903 + 0.0019 × 1,826 – 2 × 0.0684)
= Exp(7.1000)
= $1,211.94
Description
- The primary trend is increasing.
- The growth rate of the primary trend is 99.16% per annum.
- AVGO price at the close of May 8, 2024 was $1,325.37 and was inside the primary price channel.
Secondary Trend
Start date: February 22, 2024
End date: May 8, 2024
a = 7.7785
b = -0.0003
s = 0.0350
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × -0.0003) – 1
= -11.57%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0350) – 1
= 15.04%
February 22, 2024 calculations
Top border of price channel:
Exp(Y1,205)
= Exp(a + b × X1,205 + 2 × s)
= Exp(a + b × 1,750 + 2 × s)
= Exp(7.7785 + -0.0003 × 1,750 + 2 × 0.0350)
= Exp(7.2588)
= $1,420.53
Bottom border of price channel:
Exp(Y1,205)
= Exp(a + b × X1,205 – 2 × s)
= Exp(a + b × 1,750 – 2 × s)
= Exp(7.7785 + -0.0003 × 1,750 – 2 × 0.0350)
= Exp(7.1187)
= $1,234.85
May 8, 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(7.7785 + -0.0003 × 1,826 + 2 × 0.0350)
= Exp(7.2332)
= $1,384.61
Bottom border of price channel:
Exp(Y1,258)
= Exp(a + b × X1,258 – 2 × s)
= Exp(a + b × 1,826 – 2 × s)
= Exp(7.7785 + -0.0003 × 1,826 – 2 × 0.0350)
= Exp(7.0931)
= $1,203.62
Description
- The secondary trend is decreasing.
- The decline rate of the secondary trend is 11.57% per annum.
- AVGO price at the close of May 8, 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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