What stocks are about to reverse trend

Screening Filters

1. Price: {'min': 3, 'max': 100}

   • Purpose: Focus on reasonably priced, more tradable stocks and avoid extreme penny stocks and very high-priced names.
   • Rationale:
     • A minimum price of $3 filters out many illiquid penny stocks where price moves can be random or easily manipulated—those “reversals” are often noise.
     • A maximum price of $100 keeps the universe in a range most retail traders focus on when looking for emerging trend reversals, rather than very high-priced, more institutionally driven stocks.
     • This narrows the list to stocks where a technical trend reversal is more actionable for typical investors.

2. Monthly Average Dollar Volume: {'min': 300000}

   • Purpose: Ensure sufficient liquidity so that price movements are meaningful and tradable.
   • Rationale:
     • Dollar volume = price × volume; a minimum of $300k per day (on average over a month) helps exclude thinly traded stocks where a few trades can create false “signals.”
     • For trend reversal analysis, you want moves that reflect real buying/selling interest, not illiquid spikes that could reverse just as quickly.

3. Moving Average Relationship: ['PriceCrossAboveMA20']

   • Purpose: Capture classic early technical signals of a potential bullish trend reversal.
   • Rationale:
     • The 20-day moving average (MA20) is a common short-term trend gauge (~1 trading month).
     • PriceCrossAboveMA20 means the stock’s price was below the 20-day MA and has now moved above it—this is a textbook sign that downward or sideways action may be giving way to a new short-term uptrend.
     • In the context of “potential trend reversal,” this specifically targets stocks transitioning from weakness/neutral to strength.

4. Support/Resistance Relationship: ['PriceBreakResistance']

   • Purpose: Find stocks breaking above prior resistance levels, another strong sign of a potential bullish reversal.
   • Rationale:
     • Resistance is a price area where the stock previously struggled to move higher (sellers stepped in).
     • PriceBreakResistance means the stock has just pushed through that ceiling, which often signals a shift in supply-demand dynamics—buyers are now strong enough to absorb selling pressure.
     • When combined with a moving-average crossover, this strengthens the case for an emerging new uptrend rather than a random bounce.

5. 1-Month Price Change %: {'min': 0.0001}

   • Purpose: Ensure there is at least some recent positive price momentum.
   • Rationale:
     • A positive 1-month return (even tiny, >0%) confirms that price has actually started moving up recently, aligning with the idea of a trend turning from down/flat to up.
     • This avoids cases where the stock may have crossed a moving average due to a flattening MA, but price hasn’t truly begun to appreciate.

Why Results Match Your Question (“signs of a potential trend reversal”)

• Technical reversal signals:

  • Price crossing above the 20-day MA and breaking resistance are both widely used technical signs that a prior downtrend or consolidation may be ending and a new uptrend may be starting.

• Confirmation by recent performance:

  • A positive 1-month price change helps ensure that the “reversal” is not just theoretical—there is actual upward price action backing it.

• Focus on tradable, meaningful moves:

  • The price range and minimum dollar volume filters remove extremely illiquid or speculative names where “reversals” are often just random noise, leaving you with more reliable and actionable candidates for a potential new trend.