Ranking Stocks by MACD, Order Flow, and Ten-Day Returns
Summary
This Chinese stock-selection method screens for a positive MACD reading, an external-to-internal volume ratio above a stated threshold, and a positive ten-day return below an upper bound. Stocks meeting all conditions are then ranked by their ten-day gains. The article explains the combination as a way to select stocks with positive momentum and buying pressure, and provides illustrative formula and Python examples for collecting candidates and sorting them.
The article identifies several limitations: it does not account for company fundamentals or longer-term trends, and a short-term gain can be followed by a reversal. It suggests adding fundamental information, multiple return horizons, and other technical or market context. No backtest, transaction-cost assessment, or evidence of predictive performance is supplied. The example’s handling of volume and the stated order-flow ratio would need validation against the data source before use.
Key ideas
- The screen requires positive MACD, a high external-to-internal volume ratio, and a bounded positive ten-day return.
- Eligible stocks are ranked from highest to lowest by their ten-day return.
- Short-horizon price strength can reverse, and the method omits fundamentals and longer-term trend context.
- The article gives implementation examples but no backtest or performance evidence.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.