How to Conduct a Trend Analysis in Excel? (2024)

Conducting a trend analysis in Excel is one of the critical tasks in data analysis. Why?

It provides significant insights into whether key metrics are on a growth or decline path. You can easily know whether key data points are down or up-trending.

Some of the tested and proven charts for visualizing general trends in your data are:

• Line chart
• Area Line Chart
• Sentiment Trend Chart
• Dual Axis Chart
• Double Axis Line Graph and Bar Chart
• Multi-Axis Line Chart

The visualization designs (mentioned above) are amazingly easy to interpret. Besides, you can use these charts to create compelling data stories.

Excel is a popular data visualization choice among professionals and business owners worldwide. However, the application produces very basic trend analysis-oriented charts.

In other words, you’ve got to spend more time editing the chart to fit your requirements.

It turns out you can download and install a particular add-in to access ready-made and visually stunning trend analysis charts, such as Multi Axis Line, Dual Axis, Sentiment Trend, Area Line, and Line Charts.

In this blog post, you’ll learn the following:

Table of Content:

1. What is a Trend Analysis?
2. Formula for Trend Analysis?
3. Examples of Trend Analysis
4. Tested and Proven Charts for Trend Analysis in Excel
5. How to do Trend Analysis in Excel?
6. Benefits of Trend Analysis in Excel
7. Wrap up

Before jumping into the how-to guide, let’s address the following question: what is trend analysis?

What is a Trend Analysis?

Definition: Trend analysis in Excel is forecasting a pattern of key variables using past data.

For instance, you can use past data on market activity to forecast a bull or bear market. The analysis is based on the idea that what has happened in the past is likely to happen in the future. There are 3 main types of trends:

1. Short trend
2. Intermediate trend
3. Long-term trend

A trend is a general direction of key data points in a specified time. Trends can be both upward and downward. While there is no specified minimum time required for a direction to be a trend, the longer it is, the more notable the trend.

Keep reading because we’ll address the following question in the coming section: what is the formula for trend analysis?

What is the Formula for Trend Analysis?

Check out the formula of trend analysis in Excel below:

Trend analysis percentage = (Figure of the previous period – Figure of the current period)/Total of both figures

The current performance is considered greater if its current percentages are greater than the previous year’s percentage.

One of the significant benefits of trend analysis in Excel is you can predict the future using data on past actions.

For instance, it’s possible to forecast your future cash flow based on past data. Besides forecasting future performance, you can use the methodology to create reliable projections for your business.

In the coming section, we’ll highlight some practical examples of trend analysis.

Examples of Trend Analysis

Forex traders are among the professionals who use trend analysis in Excel to extract actionable insights to inform on their strategies.

They conduct the process using a variety of technical indicators together with patterns of the price action curve. Some of these indicators include:

• Moving averages (MA)
• Momentum indicators
• Trendline and chart patterns

Moving averages strategies involve entering into long, or short, positions when the short-term MA curve crosses above or below a long-term MA curve. Momentum indicator strategies involve entering into trade positions when the price action curve shows momentum signs and exits when it wanes.

Trendlines and chart pattern strategies involve entering long or short positions when the price action curve is trending higher or lower.

Tested and Proven Charts for Trend Analysis in Excel

Some of the tested and proven charts for visualizing general trends in your data are:

1. Line chart
2. Area Line Chart
3. Sentiment Trend Chart
4. Dual Axis Chart
5. Double Axis Line Graph and Bar Chart
6. Multi-Axis Line Chart

• Line Chart

A Line Chart is a visualization design that displays information as a series of data points connected by straight lines.

You can use the chart to extract trends and patterns insights into raw data. The x-axis mainly depicts time (years, months, days, weeks, etc.)

How to conduct Trend analysis in Excel should never be a nerve-wracking or time-intensive affair. Keep reading to learn more.

• Area Line Chart

An Area Chart is a visualization design that uses a line graph and color combination to display pattern and trend insights into key data points in a specified period.

The chart shares similarities with the Line Graph. In both visualization designs, key data points are connected via lines. However, the chart uses color, unlike the Line Graphs.

The Area Chart in Excel is best-suited for displaying patterns and trends of key data points.

Use the visualization design to:

• Show the rise and fall of key data points over time
• Emphasize a part-to-whole relationship over time in data.

• Sentiment Trend Chart

Use a Sentiment Trend Chart to demonstrate the trend of sentiments. The chart is amazingly critical, especially if your goal is to show the growth and decline of key variables.

The line curve in the chart shows the overall pattern and trend of a key variable over a specified period. The Sentiment Trend Graph is one of the best-suited charts for trend analysis in Excel.

• Dual Axis Line Chart

Use a Dual Axis Line Chart if your goal is to display insights into varying metrics.

The visualization design uses two different axes to illustrate the relationships between two variables. All the key data points are connected by a straight line to depict the overall pattern and trend.

In a typical line chart, there’re x and y axes.

• Double Axis Line Graph and Bar Chart

As the name suggests, the chart is made up of bars and lines, plus two varying axes.

Use the visualization design if your goal is to display insights into two varying metrics for in-depth insights. The role of line curves is to depict your data’s overall patterns and trends.

The chart comes in handy in trend analysis in an Excel spreadsheet.

• Multi-Axis Line Chart

A Multi-Axis Line Chart is made up of Line and Area Charts. Besides, it has two varying y-axes with different scales.

You can use the chart to display insights into two or more insights.

Keep reading because we’ll address the following in the coming section: how to do Trend Analysis in Excel.

How to do Trend Analysis in Excel?

Excel generates very basic trend analysis-based charts, such as the Multi-Axis Line Chart. And this means you’ve got to spend extra effort and time editing the chart.

You don’t have to undergo all this.

Download and install a particular third-party add-in into your Excel to access ready-made charts for trend analysis.

There are thousands of add-ins purposely designed for Excel. To simplify things, we tested over 60 data visualization-based add-ins.

We narrowed down our results based on the following factors:

• Ease of use, cost of access
• Quality of visualization chart
• The size of the chart library

The Excel add-in that met all our conditions is ChartExpo.

The tool comes with ready-made charts in excel that need minimum editing.

Let’s take a closer look at ChartExpo.

ChartExpo is an Excel-based add-in with an ultra-friendly user interface to ensure that any professional can visualize data, irrespective of their coding or programming skills.

How to conduct a trend analysis in Excel should never throw a curveball at you. Keep reading to discover more.

Example

This section will use a Multi-Axis Line Chart in Excel to display insights into the table below:

To install ChartExpo into your Excel, click the following link.

• Open the worksheet and click the Insert button to access the My Apps option.

• Select ChartExpo add-in and click the Insert button.

• Once ChartExpo is loaded, you will see a list of charts.

• Look for “Multi Axis Line Chart” in the list.

• Select the sheet holding your data and click the Create Chart From Selection button, as shown below.

• Check out the final chart below.

Video Tutorial: How to do Trend Analysis in Excel

In the following video you will learn how to do Trend analysis in excel using Multi Axis line chart.

Benefits of Trend Analysis in Excel

• Measure Financial Performance

Trend analysis in Excel can help you measure your business’s financial performance over a specific time. Besides, you can use the process to support your decision-making process.

• Comparison

One of the significant benefits of trend analysis in Excel is that you can compare the performance of varying variables.

You can leverage trend-based charts to assess your firm’s weaknesses and strengths, identify gaps, and implement changes for more success.

• Assess Liquidity and Profitability

Trend analysis can help you understand your company’s short-term liquidity position. Also, you can easily measure the long-term solvency of your business.

FAQs:

What does trend analysis in Excel mean?

Trend analysis in Excel is forecasting a pattern of key variables using past data. For instance, you can use past data on market activity to forecast a bull or bear market.

The analysis is based on the idea that what has happened in the past is likely to happen in the future.

What is the Difference between Ratio Analysis and Trend Analysis?

The key role of financial ratio analysis is to compare your brand with others in its peer group. You can use the ratio analysis to compare the company’s performance using certain KPIs over time. On the other hand, trend analysis is the practice of collecting data with a view to analyze its pattern.

Wrap Up

Conducting a trend analysis in Excel is one of the critical tasks in data analysis.

Why?

It provides significant insights into whether key metrics are on a growth or decline path. You can easily know whether key data points are down or up trending.

Trend analysis in Excel is forecasting a pattern of key variables using past data. You can use past data on market activity to forecast a bull or bear market.

The analysis is based on the idea that what has happened in the past is likely to happen in the future. There are 3 main types of trends, namely the short trend, intermediate trend, and long-term trend.

A trend is a general direction of key data points in a specified time. Trends can be both upward and downward. While there is no specified minimum time required for a direction to be a trend, the longer it is, the more notable the trend.

Some of the tested and proven charts for visualizing general trends in your data are:

• Line chart
• Area Line Chart
• Sentiment Trend Chart
• Dual axis Chart
• Double Axis Line Graph and Bar Chart
• Multi Axis Line Chart

The visualization designs (mentioned above) are amazingly easy to interpret. Besides, you can use these charts to create compelling data stories.

Excel is a popular data visualization tool among professionals and owners. However, the application has very basic trend analysis-oriented charts, such as Multi Axis Line Chart. Essentially, you’ve got to manually edit the chart, which is time-intensive.

So, what’s the solution?

We recommend installing third-party apps, such as ChartExpo, into your Excel to access ready-made charts for trend analysis in Excel.

ChartExpo is an add-in you can easily download and install in your Excel app. Besides, this tool comes loaded with insightful and easy to interpret charts for trend analysis.

Here’s the bottom line: You don’t need programming or coding skills to visualize your data using ChartExpo.

How to do trend analysis in Excel should never stress you or even consume a lot of your time.

Sign up for a 7-day free trial today to access easy-to-interpret and visually appealing graphs for trend analysis in Excel.