Combining Volatility, a 10-Day Moving Average Zone, and Trend Strength for Stock Selection

Summary

This note outlines a Chinese stock selection method using three filters: daily amplitude above a threshold, an opening price near the 10-day moving average, and a signal intended to identify the start of a strong rising phase. The example code operationalizes the moving-average zone as within five percent of the average, then defines trend strength through rising short versus longer exponential averages, rising volume averages, and a power indicator above its own average. Stocks passing all three groups of conditions are retained.

The article characterizes the setup as looking for volatile shares near a short-term average with signs of momentum, and suggests adding price-volume or capital-flow measures. It warns that the “strong rise start” signal may be too narrowly defined and can lead to selection errors. No historical test, return data, threshold calibration, or precise definition of the power variable is supplied, so the rules remain an illustrative screen rather than a validated strategy.

Key ideas

• The screen requires elevated amplitude, an opening price near the 10-day average, and a rising-phase signal.
• The sample implementation treats “near” as within five percent of the 10-day moving average.
• Trend confirmation combines short and longer exponential averages, volume averages, and a power indicator.
• The article recommends further price-volume or capital-flow filters and notes that its rise-start signal may be unreliable.
• No backtest results or detailed definition of the power input are provided.

Tags

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