Combining Amplitude, Weekly MACD, and Reversal Signals in a Stock Screen

Summary

This note proposes a stock screen combining daily amplitude above 1, a positive weekly MACD histogram, and a reversal or engulfing-style condition. It includes example formulas for a charting platform and a Python outline that checks amplitude, a MACD value, and recent candle direction. The examples are presented as references and would need adaptation to ensure the code implements the stated weekly signal and reversal condition consistently.

The author describes the technical filters as a way to select active stocks with upward momentum while avoiding short-lived price spikes. The document gives no backtest or performance evidence. It warns that the method omits company fundamentals and may select financially weak firms; it also notes that performance could depend on rising markets and may be vulnerable in declines. Suggested refinements include adding company-quality and regulatory filters and revisiting how the reversal condition is measured, including a possible use of Bollinger Bands.

Key ideas

• The proposed screen combines amplitude above 1, a positive weekly MACD histogram, and a reversal condition.
• The formula and Python examples are partial references and may not implement the described signals consistently.
• The approach lacks fundamental analysis and may select financially weak companies.
• The note warns of exposure to falling markets and offers no tested performance results.

Tags

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