Low-Priced Stock Screen Using Range and the 10-Day Average

Summary

This stock-selection screen combines three conditions: a prior session range greater than one percent, an opening price near the 10-day moving average, and a closing price below 12. The document describes the range as a way to identify stronger movement, proximity to the average as a sign of possible adjustment, and the price ceiling as a way to select lower-priced shares. It provides example implementations in indicator syntax and Python.

The article advises supplementing the screen with valuation measures, industry analysis, company quality checks, and a stop level. It cautions that price-based technical criteria do not capture intrinsic value or industry prospects and may not suit shares with large short-term swings. It gives no backtest results or evidence that low-priced shares have greater upside, and the screening conditions alone do not define a complete portfolio or trading plan.

Key ideas

• The screen selects stocks with a prior-session range above one percent.
• It requires the opening price to fall within five percent of the 10-day moving average.
• It filters for closing prices below 12.
• The article recommends adding fundamental and industry checks and setting a stop level.
• No backtest is provided, and the screen alone does not establish a stock’s value or upside potential.

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