Combining RSI, Consecutive Down Days, and Recent Limit-Ups in a Stock Screen

Summary

This equity screen combines an RSI below 65 with three consecutive down sessions and more than two limit-up days in a ten-day window. The stated idea is to find stocks showing recent weakness while also having a record of sharp upward moves, which the author interprets as possible rebound potential. The note includes indicator formulas and sample code for RSI and counting recent limit-up events.

The author cautions that the rule emphasizes short-term limit-up activity and does not account for longer-term business value. More than two recent limit-ups do not establish investment quality, and the note suggests supplementing the screen with valuation measures and other technical indicators. No backtest, performance statistics, or evidence of predictive power is provided. There is also an inconsistency in the written logic: three consecutive down sessions do not align clearly with the sample formula’s comparisons of prior closes and opens, so that condition needs clarification before implementation.

Key ideas

• The screen requires RSI below 65, three consecutive down sessions, and more than two limit-ups within ten days.
• The intended thesis combines recent weakness with evidence of sharp upward price moves.
• The note warns that short-term limit-up activity does not establish long-term value.
• It suggests adding valuation measures and further technical filters.
• The sample formula does not clearly match the stated consecutive down-session condition, and no backtest is reported.

Tags

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