Technical Screening

In my earlier posting (read this), I had selected 5 test stocks to test a multi-indicators trading system. The outcome of the test is cautiously optimistic, as further fine-tuning is required. Based on this simple trading system, the key indicators & buy signals are summarised as follows:

  • Price crossover above lower Keltner Channel (20,2.25) 
  • RSI(14) crosses above 30.0 
  • *new addition* RSI(14) was below 30 for the last 5 days 

I intend to automate this technical strategy into Shareinvestor Station for the purpose of stocks screening based on the above stated rules.

Based on the stated technical rules, the following is the results of the stocks screening:

Screen_jul17.png

Only Hume Industries is a listed stock whilst the rest of the screened securities are companies’ warrants / derivatives.

Let’s have a look at Hume Industries whether the technical rules are working properly in the screening process:

Hume_1.png

From the above chart, it appears that the technical rules are working correctly whereby the last closing price of Hume is above its lower band of Keltner Channel as well as the RSI(14) crossover the 30.0 mark.

The nearest support zone is around RM2.05. Nevertheless, one should perform more background research about the cement industry, which may have explained the gradual decline in Hume’s share price.

Hume_2.png

I have also tested the script on NYSE market and the following is the outcome from the screening:

US_1.png

SYSCO

The technical rules / buy signals appear to be working in this case:

US_Syco.png

KROGER

The technical rules seem to work well here:

US_KRoger.png

Buy signals generated from stocks screening should be always assessed critically. Signals could be just mere random noises. Further background / fundamental research / detailed backtesting is definitely required.  

DISCLAIMER: THIS IS A PERSONAL BLOG AND SHALL NOT BE RELIED IN WHATSOEVER MANNER BY ANYONE. ALL ARTICLES CONTAINED IN THIS SITE ARE STRICTLY FOR INFORMATION AND ILLUSTRATIVE PURPOSES ONLY AND DOES NOT PURPORT TO SHOW ACTUAL RESULTS. IT IS NOT, AND SHOULD NOT BE REGARDED AS INVESTMENT ADVICE OR AS A RECOMMENDATION REGARDING ANY PARTICULAR SECURITY OR COURSE OF ACTION. SOURCES USED IN THIS SITE HAVE NOT BEEN INDEPENDENTLY VERIFIED FOR ACCURACY, COMPLETENESS AND TIMELINESS. YOU SHOULD SEEK INDEPENDENT AND PROFESSIONAL INVESTMENT ADVICE IN REGARD TO YOUR INVESTMENT DECISIONS. THE AUTHOR MAY HOLD POSITIONS IN THE SECURITIES MENTIONED IN THE ARTICLES

Author: Ken Utau

Data Scientist, Markets Analyst and Food Lover

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