Combining Intraday MACD Histogram Contraction with a Limit-Up Exclusion

Summary

This proposed stock screen combines a daily amplitude condition with a 15-minute MACD histogram condition: the histogram must remain below zero while becoming less negative. It also excludes stocks that closed at the daily limit-up level on the previous day. The article frames the contracting negative histogram as a possible sign of a developing change in direction, while the exclusion is intended to avoid some highly speculative short-term moves. Formula and Python examples outline how the conditions might be assembled.

The document acknowledges that technical indicators can overlook company fundamentals, and that excluding recent limit-up stocks could discard continuing advances. It suggests adding other indicators and examining why a stock reached its limit. No empirical results, tested parameters, or rules for entering, exiting, and sizing positions are supplied. The examples also leave implementation details ambiguous, including how the amplitude threshold is measured and how the stated 15-minute condition is evaluated across bars, so the screen needs precise definitions and validation before use.

Key ideas

• The screen combines a daily amplitude threshold with a 15-minute negative MACD histogram that is shrinking.
• It excludes stocks that reached the upper daily price limit on the previous day.
• The contracting histogram is presented as a possible sign of a momentum shift, not proof of reversal.
• The exclusion may remove stocks whose advances continue after a limit-up session.
• The document supplies no performance evidence and leaves some indicator implementation details unclear.

Tags

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