Stock Screening with KDJ Crossovers, Daily Range, and Positive Returns

Summary

This stock screen combines three conditions: daily high-to-low amplitude above one percent, a newly formed KDJ crossover, and a positive return relative to the prior close. The article treats a larger daily range as a sign of opportunity, the crossover as a possible improvement in market momentum, and a positive return as an additional strength filter. It includes example indicator logic and Python-style code for calculating the conditions and selecting qualifying stocks.

The material describes a screening rule rather than a fully specified trading system: it does not define position sizing, exits, portfolio construction, or provide backtest results. It also notes that return data may be inaccurate and that technical and market behavior filters omit company fundamentals. Suggested extensions include adding fundamental measures, valuation or size factors, and other technical indicators. The stated rationale for the conditions should be treated as a hypothesis to test, since the article supplies no evidence that the screen predicts future gains.

Key ideas

• The screen requires daily price amplitude above one percent, a newly formed KDJ crossover, and a positive close-to-close return.
• The KDJ condition is intended to identify a recent shift in short-term momentum.
• The article provides example formulas and code, but no performance evaluation.
• The screen omits company fundamentals and may rely on imperfect return data.
• Fundamental, size, and additional technical factors are suggested as possible extensions.

Tags

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