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 12.38% per annum.
- SBUX price at the close of April 26, 2024 was $88.25 and was inside the primary price channel.
- The secondary trend is decreasing.
- The decline rate of the secondary trend is 28.66% per annum.
- SBUX price at the close of April 26, 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 SBUX 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: January 4, 2023
End date: April 26, 2024
a = 5.1629
b = -0.0004
s = 0.0365
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × -0.0004) – 1
= -12.38%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0365) – 1
= 15.72%
January 4, 2023 calculations
Top border of price channel:
Exp(Y929)
= Exp(a + b × X929 + 2 × s)
= Exp(a + b × 1,346 + 2 × s)
= Exp(5.1629 + -0.0004 × 1,346 + 2 × 0.0365)
= Exp(4.7484)
= $115.40
Bottom border of price channel:
Exp(Y929)
= Exp(a + b × X929 – 2 × s)
= Exp(a + b × 1,346 – 2 × s)
= Exp(5.1629 + -0.0004 × 1,346 – 2 × 0.0365)
= Exp(4.6024)
= $99.72
April 26, 2024 calculations
Top border of price channel:
Exp(Y1,258)
= Exp(a + b × X1,258 + 2 × s)
= Exp(a + b × 1,824 + 2 × s)
= Exp(5.1629 + -0.0004 × 1,824 + 2 × 0.0365)
= Exp(4.5753)
= $97.05
Bottom border of price channel:
Exp(Y1,258)
= Exp(a + b × X1,258 – 2 × s)
= Exp(a + b × 1,824 – 2 × s)
= Exp(5.1629 + -0.0004 × 1,824 – 2 × 0.0365)
= Exp(4.4292)
= $83.87
Description
- The primary trend is decreasing.
- The decline rate of the primary trend is 12.38% per annum.
- SBUX price at the close of April 26, 2024 was $88.25 and was inside the primary price channel.
Secondary Trend
Start date: November 2, 2023
End date: April 26, 2024
a = 6.1530
b = -0.0009
s = 0.0230
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × -0.0009) – 1
= -28.66%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0230) – 1
= 9.65%
November 2, 2023 calculations
Top border of price channel:
Exp(Y1,138)
= Exp(a + b × X1,138 + 2 × s)
= Exp(a + b × 1,648 + 2 × s)
= Exp(6.1530 + -0.0009 × 1,648 + 2 × 0.0230)
= Exp(4.6746)
= $107.19
Bottom border of price channel:
Exp(Y1,138)
= Exp(a + b × X1,138 – 2 × s)
= Exp(a + b × 1,648 – 2 × s)
= Exp(6.1530 + -0.0009 × 1,648 – 2 × 0.0230)
= Exp(4.5824)
= $97.75
April 26, 2024 calculations
Top border of price channel:
Exp(Y1,258)
= Exp(a + b × X1,258 + 2 × s)
= Exp(a + b × 1,824 + 2 × s)
= Exp(6.1530 + -0.0009 × 1,824 + 2 × 0.0230)
= Exp(4.5118)
= $91.08
Bottom border of price channel:
Exp(Y1,258)
= Exp(a + b × X1,258 – 2 × s)
= Exp(a + b × 1,824 – 2 × s)
= Exp(6.1530 + -0.0009 × 1,824 – 2 × 0.0230)
= Exp(4.4196)
= $83.06
Description
- The secondary trend is decreasing.
- The decline rate of the secondary trend is 28.66% per annum.
- SBUX price at the close of April 26, 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 SBUX and 1,499 other stocks on our new website