Combining RSI, a Rising 30-Day Average, and Company Quality

Summary

This note outlines an equity screen that combines an RSI reading below 65, a rising 30-day moving average, and a qualitative judgment that the company is sound. It expresses the technical conditions with a 14-period RSI and a comparison between the current 30-day average and its prior value. The proposed combination is intended to pair a trend filter with a limit on RSI, alongside a company-quality assessment.

The article cautions that these conditions may miss market-wide risks and suggests adding measures such as earnings per share, leverage, capital flows, and other technical indicators. Its example code gestures toward screening exchange listings, liabilities, assets, and market capitalization, but does not provide a clear operational definition for company quality. The note includes no backtest or performance evidence, and its claim that the screen may find undervalued growth companies is not supported by results shown. It is best read as a rough screening concept requiring precise definitions and validation.

Key ideas

• The screen combines RSI below 65 with an upward-sloping 30-day moving average and a company-quality judgment.
• The RSI condition is described using a 14-period lookback.
• The article suggests adding earnings, debt, capital-flow, and technical measures to refine the screen.
• It flags market-wide risk and liquidity as potential weaknesses.
• The qualitative company filter is not operationally defined, and no performance evidence is presented.

Tags

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