Equity Screen Combining Amplitude, a Rounded Price Shape, and Relative Volume
Summary
This note proposes a short-term stock screen using amplitude above 1, a rounded price pattern, and a volume ratio between 1.5 and 6. The formula defines the rounded-shape condition through the prior close’s position within the five-day high-low range, requiring it to fall below the midpoint. Relative volume is expressed as current volume divided by its five-day average. The note presents the amplitude and volume rules as ways to focus on active stocks while excluding extreme relative volume.
No backtest, sample, or outcome data is supplied, and the Python implementation is marked as unavailable. The explanation characterizes the rounded pattern as comparatively gradual but does not define or validate its risk properties. It warns that short-term volume focus can overlook company fundamentals and that strict volume bounds may exclude candidates. It recommends combining technical and fundamental information and adjusting the volume limits in light of interactions with other indicators.
Key ideas
- The screen requires amplitude above 1 and a rounded-shape condition based on the prior close within a five-day range.
- It constrains current volume relative to its five-day average to a range of 1.5 to 6.
- The note contains no performance evidence and has no Python implementation.
- Fundamentals and the effects of strict relative-volume limits are identified as concerns.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.