A Momentum Screen Using Amplitude, MACD, and RSI

Summary

This document outlines an equity selection rule based on price amplitude above 1, MACD crossing above zero, RSI over 14 periods above 50, and a condition described as the start of a strong upward move. It frames these criteria as technical signs of volatility and positive momentum. The article also presents indicator formulas and a Python-oriented example, but supplies no screening results or backtest evidence.

The source flags overfitting and the omission of company fundamentals as limitations. It suggests adding fundamental measures, experimenting with other technical indicators, and setting exit controls such as stop-loss and take-profit levels. Its explanation does not define the upward-move condition in detail, and the code example’s data handling and indicator calculations are not substantiated or validated in the text, so the rules would need careful specification and testing before use.

Key ideas

• The proposed screen combines amplitude, a MACD move above zero, RSI above 50, and an upward-trend condition.
• The article describes the filters as indicators of volatility and positive momentum.
• It warns that the rule may overfit and omits company fundamentals.
• The source gives no performance tests, and the upward-trend condition and code example need validation.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.