Basic Forecasting Tools

Abstract

We will present two fundamental time series forecasting tools. Moving average is a very simple approach, presented because it is a component of ARIMA models to be covered in a future chapter. Regression is a basic statistical tool. In data mining, it is one of the basic tools for analysis, used in classification applications through logistic regression and discriminant analysis, as well as prediction of continuous data through ordinary least squares (OLS) and other forms. As such, regression is often taught in one (or more) three-hour courses. We cannot hope to cover all of the basics of regression. However, we here present ways in which regression is used within the context of data mining.