Forecasting Analysis
hello, guys yesterday I wrote about a project on forecasting today we will go through what is forecasting and its methods.
Forecasting:
Forecasting in data analysis refers to the process of making predictions about future trends, outcomes, or events based on historical data and patterns. It is a crucial aspect of decision-making in various fields, such as economics, finance, marketing, supply chain management, and more. The primary goal of forecasting is to use past data to estimate what might happen in the future, enabling organizations and individuals to plan, allocate resources, and make informed decisions.
According to my knowledge, there are three methods to forecast.
using the forecast formula.
using graph trendlines.
using forecasting sheet
Using forecasting formula:
Here to get the future predicting values we will go through the historic data and according to that given data, we will proceed with the future prediction values.
There will be a forecast() formula in the Excel formula bar as shown in the below figure
As for the built-in formula, we need to select the future data and X's and Y's of historic data as per the Excel.
Ex: Forecast(future date,historic data,historic date)
then it will automatically predict future values or data.
Using Trendlines:
This method is a simple and appropriate method. This method will predict almost accurate data. Just we have to select the historical data and insert it into the line graph bar. After inserting it then we have to draw the line according to the graph select the trendline which appropriately matches the graph line then give the No. of forwarded days to predict future data. This can be understood by the below figure.
Using the forecast sheet:
This is thrid method and sweetest method where we have to select the whole historic data and go to the data and insert it into the forecast sheet it will automatically generate the formula and predict the output. But we have to make sure that our dataset is 85%-95% confident.
Hope you guys enjoy insights, Support my journey over the 75 days of data analysis.