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 62.96% per annum.
- CRM price at the close of April 17, 2024 was $276.32 and was inside the primary price channel.
- The secondary trend is increasing.
- The growth rate of the secondary trend is 137.78% per annum.
- CRM price at the close of April 17, 2024 was lower than the bottom border of the secondary price channel by $18.66 (6.32%). This indicates a possible reversal in the secondary trend direction.
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 CRM 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: September 16, 2022
End date: April 17, 2024
a = 3.2597
b = 0.0013
s = 0.0806
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × 0.0013) – 1
= 62.96%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0806) – 1
= 38.06%
September 16, 2022 calculations
Top border of price channel:
Exp(Y860)
= Exp(a + b × X860 + 2 × s)
= Exp(a + b × 1,247 + 2 × s)
= Exp(3.2597 + 0.0013 × 1,247 + 2 × 0.0806)
= Exp(5.0893)
= $162.27
Bottom border of price channel:
Exp(Y860)
= Exp(a + b × X860 – 2 × s)
= Exp(a + b × 1,247 – 2 × s)
= Exp(3.2597 + 0.0013 × 1,247 – 2 × 0.0806)
= Exp(4.7667)
= $117.53
April 17, 2024 calculations
Top border of price channel:
Exp(Y1,257)
= Exp(a + b × X1,257 + 2 × s)
= Exp(a + b × 1,826 + 2 × s)
= Exp(3.2597 + 0.0013 × 1,826 + 2 × 0.0806)
= Exp(5.8639)
= $352.09
Bottom border of price channel:
Exp(Y1,257)
= Exp(a + b × X1,257 – 2 × s)
= Exp(a + b × 1,826 – 2 × s)
= Exp(3.2597 + 0.0013 × 1,826 – 2 × 0.0806)
= Exp(5.5414)
= $255.02
Description
- The primary trend is increasing.
- The growth rate of the primary trend is 62.96% per annum.
- CRM price at the close of April 17, 2024 was $276.32 and was inside the primary price channel.
Secondary Trend
Start date: September 21, 2023
End date: April 17, 2024
a = 1.4564
b = 0.0024
s = 0.0513
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × 0.0024) – 1
= 137.78%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0513) – 1
= 22.78%
September 21, 2023 calculations
Top border of price channel:
Exp(Y1,114)
= Exp(a + b × X1,114 + 2 × s)
= Exp(a + b × 1,617 + 2 × s)
= Exp(1.4564 + 0.0024 × 1,617 + 2 × 0.0513)
= Exp(5.3962)
= $220.56
Bottom border of price channel:
Exp(Y1,114)
= Exp(a + b × X1,114 – 2 × s)
= Exp(a + b × 1,617 – 2 × s)
= Exp(1.4564 + 0.0024 × 1,617 – 2 × 0.0513)
= Exp(5.1909)
= $179.64
April 17, 2024 calculations
Top border of price channel:
Exp(Y1,257)
= Exp(a + b × X1,257 + 2 × s)
= Exp(a + b × 1,826 + 2 × s)
= Exp(1.4564 + 0.0024 × 1,826 + 2 × 0.0513)
= Exp(5.8922)
= $362.19
Bottom border of price channel:
Exp(Y1,257)
= Exp(a + b × X1,257 – 2 × s)
= Exp(a + b × 1,826 – 2 × s)
= Exp(1.4564 + 0.0024 × 1,826 – 2 × 0.0513)
= Exp(5.6869)
= $294.98
Description
- The secondary trend is increasing.
- The growth rate of the secondary trend is 137.78% per annum.
- CRM price at the close of April 17, 2024 was lower than the bottom border of the secondary price channel by $18.66 (6.32%). 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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