This screen shows stocks that have experienced a sharp increase in price in a short time and are therefore at least 9% away from their 20-day moving averages. This makes these stocks ideal candidates to look for mean reversion SHORT setups on the assumption that the price will at least temporarily move back towards the average price. The stocks you have witheld from this screen can be added into your actual trading platform, ready for the next trading day. Be sure to read the articles below and watch the accompanying video that explains exactly what the strategy entails and how to apply it. Good luck!
Use the stock screener to find mean reversion trading ideas
The mean reversion strategy is based on the assumption that extremely high and low prices which have been established in a relatively short time have deviated too much from the mean price so that there is a high probability that there will be a fall back
Extreme price movements, both upward and downward, are associated with high volatility and are usually short-lived. This mean reversion strategy tries to capitalize on this by taking advantage of the moment when the movement loses momentum and returns to
So, how to handle these extreme volatile stock market times? In this video I show you two ways. One intraday strategy and one swing trading strategy.
Minimum Price filter
This ensures us that the most recent day closed positive
Current highest Price in 10 days
Custom filter, current price is at least 9% above SMA20 price
Overbought Level
Minimal Liquidity
Personal Preference
Daily Charts
Run this screen in your favorite region. You can always further fine tune the screen by changing the general settings after it opened in the screener.