Excel charts can do more than visualizing the data, like calculating and showing trends and moving averages. In this guide, we’re going to show you How to perform trend analysis with charts in Excel.
Performing Trend Analysis with Charts
Creating a Chart
On some occasions, visualization is more than enough to see the trend and predict the future. A simple line chart may show you the linear trend on your data without any additional tools.
Thus, do not hesitate to create a line chart which is usually the best to visualize a timeline. You can easily create one by;
You can see that the pattern is revealed, and the amount is increasing slightly.
Obviously, trends may not be easy to figure out for every data. In these types of situations, you can let Excel visualize the trendlines as well. Frankly, it would be best to leave the trendline drawing to Excel, if you are sure about the math behind it.
You can easily add a trendline to your chart by using Add Chart Elements options on the Ribbon or the top-right corner of the chart. Use the arrow to see a few of your options.
Selecting More Options in the menu or double-clicking on an existing trendline opens the properties pane. You can easily change the type of trendline and modify it.
For example, you can choose to display the Logarithmic trendline along with the formula of the curve. Excel can even extend the trendline to show forecast values. In the example below you can see that the trendline continues for 10 periods after the actual data timeline.
Moving Average calculation is not a typical trend analysis option, rather, it is a technique for smoothing data to reduce the effects of random, short-term fluctuations. Select Moving average option in Trendline Options if your data shows a repetitive pattern in macro level. This way, you can eliminate the micro discrepancies.
The key point is to select the correct period that matches your data.