Stock Screening with RSI, Three Down Days, and a Rising 30-Day Average

Summary

This stock screening idea combines three technical conditions: a 14-period RSI below 65, three consecutive bearish sessions, and a 30-day moving average that is rising. The proposed rationale is to find stocks that have recently weakened while remaining within a broader upward trend, potentially identifying candidates for a rebound. The document includes formula examples and Python-style logic for calculating the conditions and sorting qualifying stocks by percentage change.

The source also discusses limitations: moving averages and RSI can lag, technical filters omit company fundamentals, and the screen does not inherently account for broad market conditions or sector concentration. It suggests supplementing the rules with company valuation and earnings measures, additional indicators, and market trend filters, as well as adjusting the moving-average period. The document offers no backtest results or evidence that the screen produces profitable trades; the stated rebound rationale is a hypothesis that would need testing.

Key ideas

• The screen requires RSI below 65, three consecutive down sessions, and a rising 30-day moving average.
• Its rationale is to seek a short-term rebound setup within a longer-term rising trend.
• The document provides calculation examples and ranks qualifying stocks by percentage change.
• Lagging indicators, missing fundamental data, and market-wide conditions are identified as limitations.
• No backtest evidence is supplied to establish the screen’s performance.

Tags

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