Stock Screening with Moving Average Convergence, Turnover, and Recent Gains

Summary

This stock screen looks for at least five overlapping moving averages, turnover between 2% and 9%, and a positive ten-day return below 35%. The article interprets the combined filters as a way to find shares with aligned short- and medium-term trends, adequate liquidity, and recent gains that have not become exceptionally large. It also suggests considering profitability, financial condition, and growth prospects in a fuller selection process.

The discussion gives a qualitative rationale rather than empirical evidence: it contains no backtest, portfolio results, or comparison against a benchmark. Its accompanying indicator code is not a clear implementation of the stated screening rules, and some described conditions are not connected to the final signal. The author cautions that the screen may miss longer-term risks and can select poorly performing stocks during volatile markets. Additional fundamental analysis is proposed, but its effect is not evaluated.

Key ideas

• The screen combines at least five overlapping moving averages with turnover between 2% and 9%.
• It limits the ten-day return to a positive value below 35%.
• The rationale is that aligned averages and moderate turnover may identify stocks with coherent trends and liquidity.
• The article recommends considering company profitability and financial condition as additional filters.
• It supplies no measured performance evidence, and its example code does not clearly implement the stated rules.

Tags

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