Screening Stocks with Moving-Average Crossovers, Range, and Positive PE

Summary

This document presents an equity screening rule combining a price-range condition, simultaneous upward crossovers among three moving averages, and a positive price-to-earnings ratio. It frames the crossover and range criteria as technical filters, with positive PE added as a basic profitability-related screen. Formula and sample implementation references illustrate how such conditions might be expressed, though they do not establish that the implementations are equivalent or correct.

The source cautions that the screen omits broader company fundamentals and industry conditions, and that PE is not suitable for every sector. It suggests assessing company performance, competitive position, governance, industry direction, and macroeconomic context, while diversifying. No backtest, return evidence, or precise operational definitions for the range threshold and crossover timing are supplied. The rule is therefore an initial screening concept, not evidence of a profitable strategy; market volatility and the limitations of a single valuation ratio remain material concerns.

Key ideas

• The screen combines a price-range filter, three moving-average crossover conditions, and positive PE.
• The crossover and range criteria are technical signals, while PE adds a basic valuation filter.
• PE may be unsuitable for some industries and does not replace broader fundamental analysis.
• The source recommends considering company, industry, and macroeconomic factors alongside the screen.
• No performance evidence is provided, so the rule should be treated as a selection idea rather than a validated strategy.

Tags

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