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 65.68% per annum.
- HUM price at the close of May 7, 2024 was $324.63 and was inside the primary price channel.
- The secondary trend is decreasing.
- The decline rate of the secondary trend is 49.80% per annum.
- HUM price at the close of May 7, 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 HUM 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: October 16, 2023
End date: May 6, 2024
a = 11.0465
b = -0.0029
s = 0.0448
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × -0.0029) – 1
= -65.68%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0448) – 1
= 19.64%
October 16, 2023 calculations
Top border of price channel:
Exp(Y1,118)
= Exp(a + b × X1,118 + 2 × s)
= Exp(a + b × 1,622 + 2 × s)
= Exp(11.0465 + -0.0029 × 1,622 + 2 × 0.0448)
= Exp(6.3836)
= $592.06
Bottom border of price channel:
Exp(Y1,118)
= Exp(a + b × X1,118 – 2 × s)
= Exp(a + b × 1,622 – 2 × s)
= Exp(11.0465 + -0.0029 × 1,622 – 2 × 0.0448)
= Exp(6.2043)
= $494.87
May 6, 2024 calculations
Top border of price channel:
Exp(Y1,257)
= Exp(a + b × X1,257 + 2 × s)
= Exp(a + b × 1,825 + 2 × s)
= Exp(11.0465 + -0.0029 × 1,825 + 2 × 0.0448)
= Exp(5.7888)
= $326.62
Bottom border of price channel:
Exp(Y1,257)
= Exp(a + b × X1,257 – 2 × s)
= Exp(a + b × 1,825 – 2 × s)
= Exp(11.0465 + -0.0029 × 1,825 – 2 × 0.0448)
= Exp(5.6095)
= $273.01
Description
- The primary trend is decreasing.
- The decline rate of the primary trend is 65.68% per annum.
- HUM price at the close of May 7, 2024 was $324.63 and was inside the primary price channel.
Secondary Trend
Start date: January 25, 2024
End date: May 7, 2024
a = 9.1825
b = -0.0019
s = 0.0293
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × -0.0019) – 1
= -49.80%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0293) – 1
= 12.45%
January 25, 2024 calculations
Top border of price channel:
Exp(Y1,187)
= Exp(a + b × X1,187 + 2 × s)
= Exp(a + b × 1,723 + 2 × s)
= Exp(9.1825 + -0.0019 × 1,723 + 2 × 0.0293)
= Exp(5.9881)
= $398.65
Bottom border of price channel:
Exp(Y1,187)
= Exp(a + b × X1,187 – 2 × s)
= Exp(a + b × 1,723 – 2 × s)
= Exp(9.1825 + -0.0019 × 1,723 – 2 × 0.0293)
= Exp(5.8708)
= $354.53
May 7, 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(9.1825 + -0.0019 × 1,826 + 2 × 0.0293)
= Exp(5.7936)
= $328.20
Bottom border of price channel:
Exp(Y1,258)
= Exp(a + b × X1,258 – 2 × s)
= Exp(a + b × 1,826 – 2 × s)
= Exp(9.1825 + -0.0019 × 1,826 – 2 × 0.0293)
= Exp(5.6763)
= $291.87
Description
- The secondary trend is decreasing.
- The decline rate of the secondary trend is 49.80% per annum.
- HUM price at the close of May 7, 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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