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 2.49% per annum.
- ACN price at the close of April 24, 2024 was $313.54 and was inside the primary price channel.
- The secondary trend is increasing.
- The growth rate of the secondary trend is 26.45% per annum.
- ACN price at the close of April 24, 2024 was lower than the bottom border of the secondary price channel by $15.01 (4.57%). 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 ACN 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: March 26, 2021
End date: November 13, 2023
a = 5.7716
b = -0.0001
s = 0.0959
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × -0.0001) – 1
= -2.49%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0959) – 1
= 46.76%
March 26, 2021 calculations
Top border of price channel:
Exp(Y484)
= Exp(a + b × X484 + 2 × s)
= Exp(a + b × 701 + 2 × s)
= Exp(5.7716 + -0.0001 × 701 + 2 × 0.0959)
= Exp(5.9149)
= $370.53
Bottom border of price channel:
Exp(Y484)
= Exp(a + b × X484 – 2 × s)
= Exp(a + b × 701 – 2 × s)
= Exp(5.7716 + -0.0001 × 701 – 2 × 0.0959)
= Exp(5.5313)
= $252.47
November 13, 2023 calculations
Top border of price channel:
Exp(Y1,147)
= Exp(a + b × X1,147 + 2 × s)
= Exp(a + b × 1,663 + 2 × s)
= Exp(5.7716 + -0.0001 × 1,663 + 2 × 0.0959)
= Exp(5.8484)
= $346.68
Bottom border of price channel:
Exp(Y1,147)
= Exp(a + b × X1,147 – 2 × s)
= Exp(a + b × 1,663 – 2 × s)
= Exp(5.7716 + -0.0001 × 1,663 – 2 × 0.0959)
= Exp(5.4648)
= $236.22
Description
- The primary trend is decreasing.
- The decline rate of the primary trend is 2.49% per annum.
- ACN price at the close of April 24, 2024 was $313.54 and was inside the primary price channel.
Secondary Trend
Start date: September 14, 2022
End date: April 2, 2024
a = 4.7244
b = 0.0006
s = 0.0518
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × 0.0006) – 1
= 26.45%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0518) – 1
= 23.04%
September 14, 2022 calculations
Top border of price channel:
Exp(Y854)
= Exp(a + b × X854 + 2 × s)
= Exp(a + b × 1,238 + 2 × s)
= Exp(4.7244 + 0.0006 × 1,238 + 2 × 0.0518)
= Exp(5.6240)
= $276.99
Bottom border of price channel:
Exp(Y854)
= Exp(a + b × X854 – 2 × s)
= Exp(a + b × 1,238 – 2 × s)
= Exp(4.7244 + 0.0006 × 1,238 – 2 × 0.0518)
= Exp(5.4167)
= $225.12
April 2, 2024 calculations
Top border of price channel:
Exp(Y1,242)
= Exp(a + b × X1,242 + 2 × s)
= Exp(a + b × 1,804 + 2 × s)
= Exp(4.7244 + 0.0006 × 1,804 + 2 × 0.0518)
= Exp(5.9879)
= $398.57
Bottom border of price channel:
Exp(Y1,242)
= Exp(a + b × X1,242 – 2 × s)
= Exp(a + b × 1,804 – 2 × s)
= Exp(4.7244 + 0.0006 × 1,804 – 2 × 0.0518)
= Exp(5.7805)
= $323.94
Description
- The secondary trend is increasing.
- The growth rate of the secondary trend is 26.45% per annum.
- ACN price at the close of April 24, 2024 was lower than the bottom border of the secondary price channel by $15.01 (4.57%). 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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