Stock Screening with RSI, Three Consecutive Down Days, and Bollinger Bands

Summary

This stock screen combines RSI below 65, three consecutive down days, and a closing price between the Bollinger middle and upper bands. It is presented as a way to find stocks in a decline that may be nearing a rebound. The document includes indicator formulas and sample implementations for screening historical stock data.

The article gives no backtest or performance evidence. It cautions that the method omits company fundamentals and that Bollinger Bands can lag, limiting responsiveness. It suggests adding valuation measures or other indicators, but does not specify tested rules for doing so. The stated candle conditions in the formula use prior days’ closes above their opens, which conflicts with the description of three consecutive down days; that discrepancy should be resolved before implementing or evaluating the screen.

Key ideas

• The screen requires RSI below 65 and a close between the Bollinger middle and upper bands.
• The stated intent is to find declining stocks that may have rebound potential.
• The sample formula’s prior-day candle conditions appear inconsistent with the described three down days.
• The article provides no backtest results and warns that fundamentals are omitted and Bollinger signals can lag.

Tags

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