Small-Cap Stock Screen Using MACD, Volatility, and Profitability

Summary

This article outlines a Chinese stock selection screen using daily price range, market capitalization, profitability, and MACD. The initial rules look for stocks whose high-to-low range exceeds 1%, whose market value is below 10 billion yuan, whose net profit is positive, and whose MACD was below zero two days earlier. It presents negative MACD as a way to identify downward movement, while cautioning that the indicator alone can miss reversals, company fundamentals, and event risks.

A proposed expanded version adds relative price strength, proximity to a moving average, earnings growth, and financial measures, then ranks candidates using a score. The article provides sample code but no backtest or performance evidence, and some described filters and scoring steps are not clearly consistent with one another. It therefore offers a screening concept rather than a validated strategy; practical use would require checking the data definitions, timing, and risk controls.

Key ideas

• The initial screen combines a minimum daily price range, a market-cap ceiling, positive earnings, and a prior MACD condition.
• The article treats negative MACD as evidence of downward trend, but warns that it may miss reversals and company-specific risks.
• The expanded proposal adds relative strength, moving-average proximity, and earnings-related filters.
• The sample scoring logic and written description are not fully aligned.
• No backtest or evidence of profitability is provided.

Tags

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