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 48.35% per annum.
- BKNG price at the close of April 29, 2025 was $4,909.23 and was inside the primary price channel.
- The secondary trend is decreasing.
- The decline rate of the secondary trend is 24.77% per annum.
- BKNG price at the close of April 29, 2025 was higher than the top border of the secondary price channel by $64.31 (1.33%). This indicates a possible reversal in the secondary trend direction.
- 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 BKNG 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 13, 2022
End date: March 6, 2025
a = 6.6337
b = 0.0011
s = 0.0712
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × 0.0011) – 1
= 48.35%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0712) – 1
= 32.95%
June 13, 2022 calculations
Top border of price channel:
Exp(Y534)
= Exp(a + b × X534 + 2 × s)
= Exp(a + b × 774 + 2 × s)
= Exp(6.6337 + 0.0011 × 774 + 2 × 0.0712)
= Exp(7.6124)
= $2,023.18
Bottom border of price channel:
Exp(Y534)
= Exp(a + b × X534 – 2 × s)
= Exp(a + b × 774 – 2 × s)
= Exp(6.6337 + 0.0011 × 774 – 2 × 0.0712)
= Exp(7.3276)
= $1,521.71
March 6, 2025 calculations
Top border of price channel:
Exp(Y1,218)
= Exp(a + b × X1,218 + 2 × s)
= Exp(a + b × 1,771 + 2 × s)
= Exp(6.6337 + 0.0011 × 1,771 + 2 × 0.0712)
= Exp(8.6897)
= $5,941.18
Bottom border of price channel:
Exp(Y1,218)
= Exp(a + b × X1,218 – 2 × s)
= Exp(a + b × 1,771 – 2 × s)
= Exp(6.6337 + 0.0011 × 1,771 – 2 × 0.0712)
= Exp(8.4048)
= $4,468.58
Description
- The primary trend is increasing.
- The growth rate of the primary trend is 48.35% per annum.
- BKNG price at the close of April 29, 2025 was $4,909.23 and was inside the primary price channel.
Secondary Trend
Start date: November 5, 2024
End date: April 23, 2025
a = 9.8371
b = -0.0008
s = 0.0360
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × -0.0008) – 1
= -24.77%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0360) – 1
= 15.48%
November 5, 2024 calculations
Top border of price channel:
Exp(Y1,137)
= Exp(a + b × X1,137 + 2 × s)
= Exp(a + b × 1,650 + 2 × s)
= Exp(9.8371 + -0.0008 × 1,650 + 2 × 0.0360)
= Exp(8.6222)
= $5,553.47
Bottom border of price channel:
Exp(Y1,137)
= Exp(a + b × X1,137 – 2 × s)
= Exp(a + b × 1,650 – 2 × s)
= Exp(9.8371 + -0.0008 × 1,650 – 2 × 0.0360)
= Exp(8.4782)
= $4,808.94
April 23, 2025 calculations
Top border of price channel:
Exp(Y1,251)
= Exp(a + b × X1,251 + 2 × s)
= Exp(a + b × 1,819 + 2 × s)
= Exp(9.8371 + -0.0008 × 1,819 + 2 × 0.0360)
= Exp(8.4904)
= $4,867.65
Bottom border of price channel:
Exp(Y1,251)
= Exp(a + b × X1,251 – 2 × s)
= Exp(a + b × 1,819 – 2 × s)
= Exp(9.8371 + -0.0008 × 1,819 – 2 × 0.0360)
= Exp(8.3464)
= $4,215.06
Description
- The secondary trend is decreasing.
- The decline rate of the secondary trend is 24.77% per annum.
- BKNG price at the close of April 29, 2025 was higher than the top border of the secondary price channel by $64.31 (1.33%). This indicates a possible reversal in the secondary trend direction.
- 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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