RSI, Float Market Capitalization, and Prior-Day Low Stock Screen

Summary

The article describes a Chinese stock-selection rule using an RSI below 65, a stated float-market-cap range of 5 to 10 billion yuan, and a latest close above the previous day’s low. The accompanying code excludes ST shares, obtains daily price data, applies a market-cap proxy, and ranks qualifying stocks by RSI. The text frames RSI as a measure of short-term overbought or oversold conditions and the price comparison as a basic indication of price resilience.

The implementation and description have limitations: the code’s market-cap calculation may not match the stated float-market-cap measure, and the RSI data reference is not explained. The article gives no backtest results or evidence of profitability. It warns that technical-only selection can miss company fundamentals, that frequent screening may incur trading costs, and that abrupt market changes can undermine the rules. It suggests adding fundamental and capital-flow information and adapting criteria to market conditions, without defining those additions or an exit process.

Key ideas

• The screen combines an RSI ceiling, a float-market-cap band, and a close above the previous session’s low.
• The code excludes ST stocks and ranks qualifying names by RSI.
• The code’s market-cap proxy and RSI data source are not clearly validated against the written criteria.
• No performance evidence is provided, and the article flags fundamental, transaction-cost, and regime risks.
• The author suggests supplementing technical conditions with fundamental and capital-flow analysis.

Tags

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