Screening Stocks with Weekly Moving Average Crossovers and Positive P/E

Summary

This stock selection rule combines a daily range filter, a weekly moving average crossover, and a positive price-to-earnings ratio. It seeks stocks with recent price movement and a bullish trend signal, then excludes firms with negative earnings-based valuation. The article gives formula references and a Python example that scans listed shares, calculates moving averages from daily prices, and checks the latest P/E.

The document offers a screening recipe rather than evidence of a profitable strategy: it reports no backtest results or performance statistics. It also notes that P/E can be affected by industry and market conditions, and that a short-term price signal does not establish long-term business value. Suggested refinements include adding fundamental measures such as profitability or earnings growth. Any practical use would require careful testing, including clear handling of weekly bar timing, data quality, and survivorship effects.

Key ideas

• The screen requires daily amplitude above its stated threshold, a weekly five-period average above the ten-period average, and positive P/E.
• The moving average condition is intended to identify an improving price trend.
• Positive P/E acts as a basic valuation filter but does not establish that a stock is attractively valued.
• The article provides implementation examples but no performance evidence or backtest results.
• The author suggests adding company fundamentals and adapting the screen to market conditions.

Tags

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