Screening Stocks with Positive MACD, Positive P/E, and Rising Moving Averages

Summary

This stock selection rule combines a positive MACD reading, a positive trailing P/E ratio, and a hierarchy of rising short-, medium-, and longer-term moving averages. The intended screen runs before each trading session opens. Its supplied indicator definitions use the conventional MACD components and measure moving-average direction as the one-period percentage change in each average; the shortest average’s direction must exceed the next, which must exceed the longest.

The article offers formula and sample Python references, but reports no backtest, returns, benchmark comparison, or evidence that the conditions predict gains. The sample implementation does not clearly operationalize the stated universe-wide screen and has potential calculation issues, so it should not be treated as validated or production-ready. The author notes that the simple conditions may overfit and omit relevant technical and fundamental information, and suggests adding factors, refining conditions, and monitoring selected stocks with risk controls.

Key ideas

• The screen requires MACD above zero and a positive trailing P/E ratio.
• It compares the one-period direction of three moving averages, requiring the shortest to rise fastest.
• The proposed selection is made before each trading day begins.
• The article provides formulas and sample code but no performance evidence, and warns about overfitting and omitted factors.

Tags

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