Stock Price Trends

Microchip Technology Inc (MCHP)

Microchip Technology Inc. is a publicly-listed American corporation that manufactures microcontroller, mixed-signal, analog and Flash-IP integrated circuits.

Stock Price Trends

Stock price trends estimated using linear regression.

Key facts

  • The primary trend is decreasing.
  • The decline rate of the primary trend is 4.19% per annum.
  • MCHP price at the close of April 26, 2024 was $93.60 and was higher than the top border of the primary price channel by $18.92 (25.34%). This indicates a possible reversal in the primary trend direction.
  • The secondary trend is increasing.
  • The growth rate of the secondary trend is 20.42% per annum.
  • MCHP price at the close of April 26, 2024 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 MCHP 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: November 20, 2020
End date: January 20, 2023

a = 4.3543

b = -0.0001

s = 0.0865

Annual growth rate:

Exp(365 × b) – 1
= Exp(365 × -0.0001) – 1
= -4.19%

Price channel spread:

Exp(4 × s) – 1
= Exp(4 × 0.0865) – 1
= 41.34%

November 20, 2020 calculations

Top border of price channel:

Exp(Y397)
= Exp(a + b × X397 + 2 × s)
= Exp(a + b × 571 + 2 × s)
= Exp(4.3543 + -0.0001 × 571 + 2 × 0.0865)
= Exp(4.4603)
= $86.51

Bottom border of price channel:

Exp(Y397)
= Exp(a + b × X397 – 2 × s)
= Exp(a + b × 571 – 2 × s)
= Exp(4.3543 + -0.0001 × 571 – 2 × 0.0865)
= Exp(4.1143)
= $61.21

January 20, 2023 calculations

Top border of price channel:

Exp(Y940)
= Exp(a + b × X940 + 2 × s)
= Exp(a + b × 1,362 + 2 × s)
= Exp(4.3543 + -0.0001 × 1,362 + 2 × 0.0865)
= Exp(4.3674)
= $78.84

Bottom border of price channel:

Exp(Y940)
= Exp(a + b × X940 – 2 × s)
= Exp(a + b × 1,362 – 2 × s)
= Exp(4.3543 + -0.0001 × 1,362 – 2 × 0.0865)
= Exp(4.0214)
= $55.78

Description

  • The primary trend is decreasing.
  • The decline rate of the primary trend is 4.19% per annum.
  • MCHP price at the close of April 26, 2024 was $93.60 and was higher than the top border of the primary price channel by $18.92 (25.34%). This indicates a possible reversal in the primary trend direction.

Secondary Trend

Start date: April 5, 2022
End date: April 26, 2024

a = 3.5761

b = 0.0005

s = 0.0738

Annual growth rate:

Exp(365 × b) – 1
= Exp(365 × 0.0005) – 1
= 20.42%

Price channel spread:

Exp(4 × s) – 1
= Exp(4 × 0.0738) – 1
= 34.32%

April 5, 2022 calculations

Top border of price channel:

Exp(Y741)
= Exp(a + b × X741 + 2 × s)
= Exp(a + b × 1,072 + 2 × s)
= Exp(3.5761 + 0.0005 × 1,072 + 2 × 0.0738)
= Exp(4.2695)
= $71.48

Bottom border of price channel:

Exp(Y741)
= Exp(a + b × X741 – 2 × s)
= Exp(a + b × 1,072 – 2 × s)
= Exp(3.5761 + 0.0005 × 1,072 – 2 × 0.0738)
= Exp(3.9744)
= $53.22

April 26, 2024 calculations

Top border of price channel:

Exp(Y1,258)
= Exp(a + b × X1,258 + 2 × s)
= Exp(a + b × 1,824 + 2 × s)
= Exp(3.5761 + 0.0005 × 1,824 + 2 × 0.0738)
= Exp(4.6524)
= $104.83

Bottom border of price channel:

Exp(Y1,258)
= Exp(a + b × X1,258 – 2 × s)
= Exp(a + b × 1,824 – 2 × s)
= Exp(3.5761 + 0.0005 × 1,824 – 2 × 0.0738)
= Exp(4.3573)
= $78.05

Description

  • The secondary trend is increasing.
  • The growth rate of the secondary trend is 20.42% per annum.
  • MCHP price at the close of April 26, 2024 was inside the secondary price channel.