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Breakouts scan

Consolidation Breakout Screener

This scan finds stocks that broke above their 20-day high while their average daily range (ATR) is below 2.5% of the price, in an uptrend above the 50-day average.

Run this scan in the live demoFree, no sign-up. The demo uses made-up sample data.

The exact rule

Type this in Chalni: close above 20 day high and atr below 2.5% and close above 50 day sma

  1. Close > 20-day high
  2. ATR%(14) < 2.5
  3. Close > SMA(50)

Find US stocks where the closing price is above the highest high of the last 20 days; and the daily range, ATR % (14) is below 2.5; and the closing price is above the 50-day simple moving average.

Formula view
close > highest(high, 20, before_today)
AND atr_pct(14) < 2.5
AND close > sma(close, 50)
Example chart: Quiet base breakoutDaily candles of a made-up sample stock with 20-day high (before today); 50-day SMA; Lower panel: ATR % (14), dotted line at 2.5. The shaded day is the day the scan fired.
  • 20-day high (before today)
  • 50-day SMA
  • Lower panel: ATR % (14), dotted line at 2.5
  • Shaded day: the scan fired
Example from Chalni's made-up sample market, not a real stock. It shows the most recent time this scan fired in the sample US market, picked whether or not the trade worked.

What it means

Stocks often move in steps: a run up, then a quiet sideways "base" where buyers and sellers balance, then another run. A breakout from a quiet base matters because the stock was calm before it. A sudden move out of calm often means new demand has arrived.

ATR (Average True Range) measures how much a stock moves on a normal day. Asking for ATR below 2.5% keeps the scan on steady stocks, not wild ones that break out and fall back every week.

How traders use it

  • Look for bases that lasted several weeks. Longer bases often lead to bigger moves.
  • A stop just under the base is a natural place to be proven wrong.
  • Add a volume rule if you want proof that buyers joined the breakout.

Watch out for

  • Some stocks are quiet because nobody is interested. Check that the stock trades enough shares.
  • Breakouts just before an earnings report can reverse on the news. Use the earnings filter in the demo.

Test it before you trust it

Every scan in Chalni sits an exam. First it runs on older data, the practice: each time it picks a stock, the stock is held for 10 trading days and 0.2% is paid in costs. Then it runs on newer data it has never seen, the exam. A scan that only works in practice has just memorised the past.

See the practice and exam results for this scan in the demo (on sample data; real data comes at launch).

Questions

What is a consolidation breakout?

It is when price leaves a sideways range (a consolidation, or base) by closing above its top. Traders see it as the end of a pause and the start of a new move.

Why use ATR in a breakout scan?

ATR shows how much a stock usually moves in a day. A low ATR before the breakout means the stock was calm, so the breakout stands out more.

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