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Hi there, how would i set up a scan where i look for stocks that have been consolidating in a range/tight range for X amount of time?
Another way might be Price Channels. Choose a channel length, a per cent difference ( e.g. upper - lower divided by lower less than, say, 1 per cent) and today's upper = x days ago upper and today's lower = x days ago lower - where the x is less than the length of the channel - so maybe 15 days ago for a 20 day channel.
You would have to play around with it quite a bit to get what you like. Run it for dates in the past to see what happens after the scan conditions are met.
[Upper Price Chan(20) > close]
[Lower Price Chan(20) < close]
This formulation says that price for the last 20 days is in between a range, right?
and [Upper Price Chan(20) > close]
and [Lower Price Chan(20) < close]
Is that correct, that just catches any 20day range?
then i want to add another statement which says that price is close to the bottom of the range, or price is close to the top of the range.....is that possible using a stochastic statement?
To test for the width of the range, you have to compare the difference between the upper and lower channels
(Upper Price Chan(20) - Lower Price Chan(20)) to the Lower Price Chan value - so -
and [Upper Price Chan(20) - Lower Price Chan(20) < Lower Price Chan(20) * .1]
To locate the current close in the price channel, you can use Fast Stochastics. For instance, to find closes below the middle of the channel
and [Fast Stoch %K(20,1) < 50]