A Stock Screen Combining Moving Average Convergence and Opening Price Limits

Summary

This post describes a stock screen combining three conditions: at least five moving averages converge, the ticker begins with 60, and the quoted 9:25 gain is below 6%. It interprets convergence as a sign of relative price stability and the opening-price limit as a way to avoid stocks that have already risen sharply before the market opens. It recommends considering additional filters such as market capitalization or valuation.

The accompanying code is presented as a final implementation, but it does not reliably express the stated screen. Its moving-average check compares only the five-period and sixty-period averages over several bars, rather than confirming that five averages converge. The later ticker and opening-price conditions follow an earlier return, making them unreachable in the shown function. The post also gives no backtest results or evidence that the filters predict returns. These gaps mean the written idea is more useful as a screening concept than as ready-to-run strategy logic.

Key ideas

• The proposed screen combines moving-average convergence, a ticker-prefix filter, and a pre-open gain ceiling.
• The post interprets convergence as relative stability and the opening filter as avoiding sharp early gains.
• It suggests adding company-size or valuation filters.
• The displayed function does not actually check all five averages or reach its later conditions.
• No performance evidence is reported.

Tags

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