Darvas Box Scan — US Stocks in Stage 2 Uptrend Near 52-Week High on NYSE & NASDAQ

Nicolas Darvas's system identifies stocks making new price highs with strong volume, defines a 'box' between recent support (box floor) and resistance (box ceiling), then buys when price breaks above the box ceiling. He would hold as long as price stayed above the box, selling when price fell back below the floor. The system focuses entirely on price action and trend, ignoring fundamental analysis.

Stocks within 10% of their 52-week high (near the box ceiling) and at least 30% above their 52-week low (confirming a strong trend range). This combination identifies stocks in confirmed Stage 2 uptrends with significant momentum range — not just flat stocks near arbitrary highs.

Stage 2 is the advancing phase of a stock's price cycle, typically characterized by: price above the 200-day moving average, moving average itself trending upward, volume increasing on up days and decreasing on down days, and stock making higher highs and higher lows. The Darvas screen's near-52-week-high requirement is a practical proxy for identifying Stage 2 without needing moving average data.

The 52-week high effect is well-documented in academic finance. Near-high stocks have cleared overhead supply — all buyers from the past year are profitable and not sellers under pressure. Institutional investors who missed the initial move are waiting for confirmation before adding. This creates a supply gap at new highs that strong companies with genuine momentum break through with surprising frequency.

Purely technical. Darvas himself analyzed only price and volume. He explicitly avoided reading financial statements or analyst reports. The Darvas Box scan on StockSifting provides the technical filter — users can then apply fundamental analysis to each candidate to find the strongest combinations of price momentum and business quality.

Darvas required volume at or above average when price broke above the box ceiling. A breakout on below-average volume is weak and unreliable. A breakout on 1.5–2× average daily volume is strong. Volume confirms institutional participation — large funds cannot buy quietly in small volumes, so meaningful accumulation always shows in volume.

Both identify Stage 2 uptrends. The Darvas Box uses only price relative to 52-week high and low. Minervini's Trend Template adds moving average alignment requirements (price above 50-day and 200-day MA, 50-day above 200-day) and a minimum distance from the 52-week low. The Minervini screen is more technically rigorous; the Darvas screen is simpler and faster to apply.

Yes. Darvas traded in an era of simpler markets with less institutional competition. Adding fundamental filters — earnings growth, ROCE, analyst consensus — significantly improves the hit rate of Darvas-identified momentum stocks. The best Darvas Box candidates are those also appearing on quality-growth screens like Winner Stocks or High Quality Compounders.

Darvas used the box floor as his stop — if price fell below the recent support level, he exited immediately. Practically, a stop 5–8% below entry or at the 50-day moving average works as a risk management rule. Darvas was strict about cutting losses — he never let a losing Darvas Box trade become more than a small percentage of portfolio.

In bull market environments where the overall market trend is upward. Darvas made most of his profits during the 1957–1959 US bull market. In bear markets and sideways markets, near-52-week-high stocks face headwinds from overall market pressure. The Darvas system works with the trend, not against it — checking the broader market direction is essential context for applying this screen.