Screening Stocks for High Amplitude, Rising Averages, and Reversal Signals

Summary

This short-term equity screen looks for stocks with daily amplitude above 1%, an upward-sloping moving-average condition, and a price reversal pattern. The stated selection rules include a move above the three-day moving average and recent closes above an earlier close. The post supplies formula and Python examples intended to identify candidates.

The article characterizes the setup as a possible trend reversal, but offers no historical test, performance measurements, or evidence of profitability. It notes that combining multiple conditions can sharply narrow the candidate pool and that short-term price and amplitude signals carry risk. It also cautions that the method omits broad market conditions, economic factors, industry assessments, and company fundamentals. The formula and prose descriptions do not align perfectly, so the precise signal definition should be validated before implementation.

Key ideas

• The screen combines amplitude above 1%, a rising-average condition, and a reversal pattern.
• The described rules refer to price crossing a three-day moving average and recent closes relative to prior prices.
• The post includes formula and Python examples but no performance evidence.
• Multiple filters may leave a small candidate set, while short-term signals can be risky.
• Market, industry, and fundamental analysis are absent from the basic screen.

Tags

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