A Stock Screen Using RSI, Daily Gains, and Recent Trading Activity

Summary

The proposed screen targets main-board Chinese stocks with RSI below 65 and a daily gain above 1%, alongside a condition described as evidence of prior-day large-player control. The accompanying examples use recent price and volume activity, including a strong daily rise and elevated turnover, as proxies for that activity. The article frames the combination as a way to find stocks with upward momentum while filtering by market segment.

The rationale treats RSI below 65 as oversold and the daily gain as evidence of continuing strength, although RSI below 65 alone does not establish oversold conditions. No backtest, sample, or performance evidence is supplied, and the stated expectation of excess returns is not demonstrated. The document warns about sentiment, news, chasing advances, and losses in unfavorable markets. It suggests incorporating flow or block-trade data, model tuning, and exit controls, but does not define validated rules for these additions. The prose and code also use loosely specified proxies, so the intended signal requires clarification and testing.

Key ideas

• The screen combines RSI below 65, a daily gain above 1%, main-board membership, and a recent activity condition.
• The code uses price and volume observations as proxies for large-player control.
• The document gives no empirical evidence that the rules produce excess returns.
• RSI below 65 does not by itself establish that a stock is oversold.
• The author identifies sentiment, news, and adverse market conditions as risks.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.