Stock Screening with RSI, Three Down Candles, and Float Size

Summary

This Chinese stock-screening example combines a 14-period RSI below 65, three consecutive bearish candles, and a circulating share count no greater than 5.5 billion. The document presents the rules as a way to identify stocks showing short-term weakness while limiting the screen by share float. It includes sample indicator logic and Python-style pseudocode for applying the conditions to market data.

The author describes the screen as a starting point and notes that it omits broad market direction, company financial health, and other fundamentals. The share-float data also needs to be accurate and timely. No backtest results or performance evidence are provided, so the screen’s effectiveness is not established. The suggested extensions are to include more fundamental and market-sentiment measures and to compare additional indicators, such as moving averages and MACD, across multiple timeframes. The document does not specify entry, exit, or risk-management rules.

Key ideas

• The screen requires a 14-period RSI below 65 and three consecutive sessions with closes below opens.
• It also limits qualifying stocks to those with circulating shares at or below 5.5 billion.
• The example supplies indicator logic and pseudocode but no measured performance results.
• Market conditions, financial health, and the reliability of float data are identified as limitations.
• Additional fundamentals and multi-timeframe technical checks are proposed as possible refinements.

Tags

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