Stock Screening with High Amplitude, Rounded Price Shape, and Three Down Days

Summary

The document proposes a Chinese equity screening rule combining three chart conditions: price amplitude above a threshold, a rounded price pattern, and three consecutive declining closes. It interprets the amplitude condition as a way to find active stocks, the rounded shape as relatively smooth movement around an average, and the run of down days as a sign of cooling interest that may precede a short-term adjustment. A sample formula expresses the shape using a 50-period high-low range and checks consecutive lower closes.

The material is a qualitative strategy sketch, not a tested trading system. It provides no measured returns, comparison group, holding period, entry or exit plan, or evidence that the pattern predicts a reversal. The author notes that the screen relies on technical factors and may select poorly or encourage excessive short-term trading. Suggested improvements include adding fundamental checks and combining other indicators, such as MACD, but no optimized version or Python implementation is supplied.

Key ideas

• The screen combines a price-amplitude threshold, a rounded-range condition, and three consecutive declining closes.
• The stated rationale is to identify active stocks with a recent pullback.
• The sample rule evaluates price position within a 50-period high-low range.
• The document provides no performance testing or complete entry and exit rules.
• It suggests combining technical signals with fundamentals and additional indicators.

Tags

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