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 41.40% per annum.
- ADBE price at the close of May 6, 2025 was $382.98 and was inside the primary price channel.
- The secondary trend is increasing.
- The growth rate of the secondary trend is 798.73% per annum.
- ADBE price at the close of May 6, 2025 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 ADBE 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: June 28, 2024
End date: May 6, 2025
a = 8.6011
b = -0.0015
s = 0.0588
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × -0.0015) – 1
= -41.40%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0588) – 1
= 26.50%
June 28, 2024 calculations
Top border of price channel:
Exp(Y1,042)
= Exp(a + b × X1,042 + 2 × s)
= Exp(a + b × 1,513 + 2 × s)
= Exp(8.6011 + -0.0015 × 1,513 + 2 × 0.0588)
= Exp(6.5031)
= $667.22
Bottom border of price channel:
Exp(Y1,042)
= Exp(a + b × X1,042 – 2 × s)
= Exp(a + b × 1,513 – 2 × s)
= Exp(8.6011 + -0.0015 × 1,513 – 2 × 0.0588)
= Exp(6.2680)
= $527.45
May 6, 2025 calculations
Top border of price channel:
Exp(Y1,255)
= Exp(a + b × X1,255 + 2 × s)
= Exp(a + b × 1,825 + 2 × s)
= Exp(8.6011 + -0.0015 × 1,825 + 2 × 0.0588)
= Exp(6.0462)
= $422.52
Bottom border of price channel:
Exp(Y1,255)
= Exp(a + b × X1,255 – 2 × s)
= Exp(a + b × 1,825 – 2 × s)
= Exp(8.6011 + -0.0015 × 1,825 – 2 × 0.0588)
= Exp(5.8112)
= $334.01
Description
- The primary trend is decreasing.
- The decline rate of the primary trend is 41.40% per annum.
- ADBE price at the close of May 6, 2025 was $382.98 and was inside the primary price channel.
Secondary Trend
Start date: April 16, 2025
End date: May 6, 2025
a = -5.0237
b = 0.0060
s = 0.0128
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × 0.0060) – 1
= 798.73%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0128) – 1
= 5.24%
April 16, 2025 calculations
Top border of price channel:
Exp(Y1,242)
= Exp(a + b × X1,242 + 2 × s)
= Exp(a + b × 1,805 + 2 × s)
= Exp(-5.0237 + 0.0060 × 1,805 + 2 × 0.0128)
= Exp(5.8606)
= $350.93
Bottom border of price channel:
Exp(Y1,242)
= Exp(a + b × X1,242 – 2 × s)
= Exp(a + b × 1,805 – 2 × s)
= Exp(-5.0237 + 0.0060 × 1,805 – 2 × 0.0128)
= Exp(5.8096)
= $333.47
May 6, 2025 calculations
Top border of price channel:
Exp(Y1,255)
= Exp(a + b × X1,255 + 2 × s)
= Exp(a + b × 1,825 + 2 × s)
= Exp(-5.0237 + 0.0060 × 1,825 + 2 × 0.0128)
= Exp(5.9809)
= $395.80
Bottom border of price channel:
Exp(Y1,255)
= Exp(a + b × X1,255 – 2 × s)
= Exp(a + b × 1,825 – 2 × s)
= Exp(-5.0237 + 0.0060 × 1,825 – 2 × 0.0128)
= Exp(5.9299)
= $376.11
Description
- The secondary trend is increasing.
- The growth rate of the secondary trend is 798.73% per annum.
- ADBE price at the close of May 6, 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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