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 96.64% per annum.
- AVGO price at the close of April 29, 2025 was $191.17 and was lower than the bottom border of the primary price channel by $29.94 (13.54%). This indicates a possible reversal in the primary trend direction.
- The secondary trend is decreasing.
- The decline rate of the secondary trend is 67.94% per annum.
- AVGO price at the close of April 29, 2025 was higher than the top border of the secondary price channel by $3.06 (1.63%). 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 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: August 26, 2022
End date: February 26, 2025
a = 2.1746
b = 0.0019
s = 0.0785
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × 0.0019) – 1
= 96.64%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0785) – 1
= 36.88%
August 26, 2022 calculations
Top border of price channel:
Exp(Y586)
= Exp(a + b × X586 + 2 × s)
= Exp(a + b × 848 + 2 × s)
= Exp(2.1746 + 0.0019 × 848 + 2 × 0.0785)
= Exp(3.9026)
= $49.53
Bottom border of price channel:
Exp(Y586)
= Exp(a + b × X586 – 2 × s)
= Exp(a + b × 848 – 2 × s)
= Exp(2.1746 + 0.0019 × 848 – 2 × 0.0785)
= Exp(3.5887)
= $36.19
February 26, 2025 calculations
Top border of price channel:
Exp(Y1,212)
= Exp(a + b × X1,212 + 2 × s)
= Exp(a + b × 1,763 + 2 × s)
= Exp(2.1746 + 0.0019 × 1,763 + 2 × 0.0785)
= Exp(5.5977)
= $269.80
Bottom border of price channel:
Exp(Y1,212)
= Exp(a + b × X1,212 – 2 × s)
= Exp(a + b × 1,763 – 2 × s)
= Exp(2.1746 + 0.0019 × 1,763 – 2 × 0.0785)
= Exp(5.2838)
= $197.11
Description
- The primary trend is increasing.
- The growth rate of the primary trend is 96.64% per annum.
- AVGO price at the close of April 29, 2025 was $191.17 and was lower than the bottom border of the primary price channel by $29.94 (13.54%). This indicates a possible reversal in the primary trend direction.
Secondary Trend
Start date: December 16, 2024
End date: April 23, 2025
a = 10.7922
b = -0.0031
s = 0.0661
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × -0.0031) – 1
= -67.94%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0661) – 1
= 30.27%
December 16, 2024 calculations
Top border of price channel:
Exp(Y1,165)
= Exp(a + b × X1,165 + 2 × s)
= Exp(a + b × 1,691 + 2 × s)
= Exp(10.7922 + -0.0031 × 1,691 + 2 × 0.0661)
= Exp(5.6546)
= $285.61
Bottom border of price channel:
Exp(Y1,165)
= Exp(a + b × X1,165 – 2 × s)
= Exp(a + b × 1,691 – 2 × s)
= Exp(10.7922 + -0.0031 × 1,691 – 2 × 0.0661)
= Exp(5.3902)
= $219.24
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(10.7922 + -0.0031 × 1,819 + 2 × 0.0661)
= Exp(5.2557)
= $191.66
Bottom border of price channel:
Exp(Y1,251)
= Exp(a + b × X1,251 – 2 × s)
= Exp(a + b × 1,819 – 2 × s)
= Exp(10.7922 + -0.0031 × 1,819 – 2 × 0.0661)
= Exp(4.9913)
= $147.13
Description
- The secondary trend is decreasing.
- The decline rate of the secondary trend is 67.94% per annum.
- AVGO price at the close of April 29, 2025 was higher than the top border of the secondary price channel by $3.06 (1.63%). 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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