Selecting Stocks with Rising Moving Averages and a Moderate RSI

Summary

This document presents a technical stock screen using three conditions: RSI(14) below 65, a short moving average rising on the latest observation, and a 30-day moving average also rising. Its example code computes the RSI and moving averages from adjusted daily prices, then retains stocks that pass the checks. The short average is set to five days in the example, serving as a near-term direction measure alongside the longer trend filter.

The article frames RSI and the short average as measures of short-term conditions, while the 30-day average represents a broader trend. It provides indicator definitions and an implementation example, but no historical results, benchmark, transaction costs, or evidence that the screen improves returns. It also notes that the rules omit company fundamentals and broader market conditions, and may include low-quality stocks. Suggested additions include other technical indicators and valuation or profitability measures; these are proposals rather than tested refinements.

Key ideas

• The screen requires RSI(14) to remain below 65.
• It checks that both a short moving average and the 30-day moving average are rising.
• The example uses a five-day short average and adjusted daily price data.
• The rules omit fundamentals and broad market conditions, and the article gives no performance testing.
• Additional technical and fundamental filters are suggested as possible refinements.

Tags

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