Screening Stocks for Rising Averages and Higher Lows

Summary

This Chinese equity screening example combines three technical conditions: amplitude above 1%, an upward-moving short average or price crossing above a three-day average, and a rising or supported recent low. The document gives formula and Python-style examples. In the formula version, amplitude is measured against the prior close, the one-period and three-period averages are compared, and the current low is checked against an exponentially smoothed measure of the lowest price over 90 periods. The accompanying code also checks recent price and low behavior.

The screen is presented as a way to find stocks with movement and improving price structure, but it contains no backtest results or evidence that the filters predict returns. The author notes that the approach uses technical indicators alone and omits company fundamentals and broader market conditions. Differences between the written conditions and the implementation details may also affect which stocks qualify, so the examples require careful validation before use.

Key ideas

• The screen combines amplitude, a short-term moving-average condition, and a higher-low measure.
• The formula checks the current low against an average of recent rolling lows.
• The Python example adds checks on recent closes and lows to represent a moving-average cross and improving price structure.
• The document cautions that technical filters omit fundamentals and market context, and provides no performance evidence.

Tags

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