Stock Screening with RSI, Bid-Ask Volume, and Positive Earnings

Summary

This proposed stock-selection rule combines a 14-period RSI below a stated ceiling, greater volume on the best bid than on the best ask, and a positive price-to-earnings ratio. The post presents the combination as a way to consider price conditions, order-side activity, and valuation when screening equities. It includes formula and Python illustrations of the filters.

The article offers no backtest, performance evidence, or detailed trading rules for acting on selected stocks. It cautions that a positive or low PE alone may conceal weak fundamentals and that the screen does not adequately account for company growth. It suggests assessing financial data and market conditions more broadly, and using a growth-adjusted valuation measure alongside PE. The RSI and bid-versus-ask volume conditions are described as screening inputs, but the post does not establish that they reliably identify undervaluation or favorable market sentiment.

Key ideas

• The screen selects stocks using RSI, bid-side versus ask-side volume, and positive PE.
• The RSI calculation is specified over a fourteen-period window.
• The post provides formula and Python illustrations but no performance evidence.
• PE can be misleading without a fuller review of company fundamentals and growth.
• The author suggests broader analysis and a growth-adjusted valuation measure.

Tags

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