Stock Screening with Rising Lows and Converging Moving Averages

Summary

The note presents a stock screen combining amplitude above one, rising lows, and at least five converging moving averages. It describes the convergence condition as a way to identify stocks with steadier price behavior, alongside a rising price base. The accompanying indicator formula and Python example offer rough implementations using price history, a bottom measure, dispersion relative to ATR, and repeated closes above a moving average. The examples are references rather than a complete, validated specification of the screen.

The author cautions that the approach depends heavily on short-term price action, may miss stocks with good prospects but weak recent performance, and may be less reliable for highly volatile stocks. Suggested additions include volume and valuation or company fundamentals. No backtest, performance data, precise definition of moving-average convergence, or validation of the sample code is provided, so the screening logic should be treated as a preliminary technical filter.

Key ideas

• The screen combines amplitude above one with rising lows and converging moving averages.
• The examples approximate convergence using price dispersion relative to ATR and closes above a moving average.
• The approach relies on recent price behavior and may miss stocks whose short-term trend is weak.
• The note identifies possible bias for volatile stocks and recommends considering additional technical and fundamental measures.

Tags

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