A Momentum Stock Screen Using Recent Gains and Daily MACD

Summary

This post describes a stock-selection rule that combines price movement with a trend indicator. It screens for amplitude above one, at least one daily gain of 10 percent or more in the prior 25 trading days, and a positive daily MACD reading. Its final stated rule adds a minimum market value of 1 billion. The post presents these criteria as a way to find volatile stocks that have recently made a strong move while retaining a positive trend signal.

The rationale is qualitative; the article provides no backtest results or evidence that the screen predicts returns. It notes that MACD lags price changes and may remain positive during a broad market decline, while the amplitude and sharp-gain filters can exclude quieter stocks. It suggests combining technical signals with market, sector, size, and fundamental information. The provided formula and Python example are references, but the Python function and MACD construction appear inconsistent with the stated screening rule, so their implementation should not be assumed to reproduce it exactly.

Key ideas

• The screen requires amplitude above one, a daily gain of at least 10 percent within the prior 25 sessions, and positive daily MACD.
• The final stated rule also imposes a minimum market value of 1 billion.
• The post describes MACD as a lagging signal that can fail during broad market declines.
• No backtest or return evidence is provided, and the code examples may not implement the prose rule consistently.

Tags

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