Screening Chinese Stocks by Volatility, Float Size, and a KDJ Golden Cross

Summary

This short-term Chinese equity screen combines three conditions: daily amplitude above 1, a circulating share count no greater than 5.5 billion, and a newly formed KDJ bullish crossover. It describes the amplitude filter as a way to favor more volatile stocks, the float cap as a way to select smaller companies, and the crossover as a possible signal of changing market sentiment. The article also gives indicator formulas and example implementations for applying the conditions.

The document warns that technical signals can be noisy and lagging, and that a short-term screen may ignore company fundamentals, industry trends, and long-term risks. It proposes adding fundamental and financial criteria or more indicators, while acknowledging no measured returns, backtest, or evidence of predictive performance. The selection logic is therefore a screening proposal, not a validated trading strategy.

Key ideas

• The screen requires amplitude above 1, circulating shares at or below 5.5 billion, and a new KDJ crossover.
• The author associates higher amplitude with short-term trading activity and smaller float with potentially higher risk and reward.
• The article characterizes the KDJ crossover as a possible sign of changing market sentiment, while noting indicator lag.
• It recommends adding fundamental and financial filters and considering a longer horizon to reduce noise.

Tags

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