Screening Shanghai-Listed Stocks for High Range and Reversal Candles

Summary

This note describes a daily stock screen combining three conditions: the stock code begins with 60, the session’s high-to-low range exceeds 1% of its open, and the close is below the open but above the prior close. The last condition identifies a bearish session that nevertheless closed higher than the previous day, which the article calls a reversal pattern. It also suggests sorting qualifying stocks by trading value.

The document offers formula and Python examples, but no backtest, performance results, or evidence that the signal predicts returns. It frames a wider intraday range as potential opportunity, while warning that high volatility can increase risk and that the candle pattern may lag or fail. It recommends combining the screen with other technical and fundamental analysis, considering steadier capital flows, and diversifying positions. The Python example filters rows before calculating the prior close by stock, so users should check that the prior close is aligned with each stock’s actual preceding trading day when implementing the screen.

Key ideas

• The screen selects codes beginning with 60 and sessions whose high-low range exceeds 1% of the open.
• A qualifying candle closes below its open but above the prior session’s close.
• The article proposes ranking matches by trading value.
• The document provides no backtest evidence and cautions that the pattern can lag and high volatility raises risk.
• It recommends combining signals with broader analysis and diversifying capital.

Tags

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