How to filter out gappy stocks

muscleman

New member
I am trying to build a scanner, and it needs to have some basic liquidity rules like market cap > 1b and average daily volume > 50k. I also want to add a custom filter that excludes frequent gappers. For example, ABB really ****s because on the daily chart, you can see it gaps around pretty much every day.
The other example is AIQUY. While gaps provide special info, they do not in such stocks that gaps every day.
What's your suggestion to filter out this kind of stocks?
 
i think it is easier to start at the end. describe what you want to see, or have happen. then work your way backwards.

if you want a program to do stuff,
3. you need to create formulas that compare things/conditions.
2. things need to be defined.
1. list out chart characteristics to look for, and define them.


things to define,
..frequent,
what does frequent mean to you?

....on each bar, look back x bars and count the gaps and calculate a ratio. then compare the ratio to some number.

..gap
what 2 price parameters define a gap?
high and low? close to close?

should the gap be > than a dollar amount or > than a % of a price?
 
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I think the gap happens when low[0] > high[1]. If occasionally it gaps, I understand. That's the nature of stocks that don't trade 24 hours a day. But if it gaps pretty much every day, then it is not a tradable stock. It is unclear to me how the rules should be though. I start learning thinkscript last week and feel comfortable to write a custom script to filter this out, but I mostly want to discuss
1. Is there an existing custom filter that I can use that filters out gappy stocks?
2. What rules do you think are the best that identifies gappy stocks?
 

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