A Lookback at Some Recent RSI Signals
Each day,
TradingMarkets publishes
7 Trading Ideas for Today, a selection of stocks from our daily indicators. TradingMarkets
Stock Indicators are based upon our latest quantitative research, and
highlight trading edges backed by our database of more than 7-million historical
simulated trades.
Our
2-Period RSI
Indicator continues to produce great short term returns on both the long
side and short side of stocks. Click on the following stock names to see
previous articles featuring this indicator and the returns it produced over a
5-day period.
Zoran
(
ZRAN |
Quote |
Chart |
News |
PowerRating)+7.6%
Genesco
(
GCO |
Quote |
Chart |
News |
PowerRating) +4.1%
Medivation
(
MDVN |
Quote |
Chart |
News |
PowerRating) +14.4%
WellPoint
(
WLP |
Quote |
Chart |
News |
PowerRating) +4.0%
These are stocks that have a 2-period RSI reading below 2 and are trading above
their 200-day
moving average. Our research shows that stocks trading above their
200-day moving with a 2-period RSI reading below 2 have shown positive returns,
on average, 1-day, 2-days and 1-week later. Historically, these stocks have
provided traders with a significant edge. To learn more about our research into
stocks that have a 2-period RSI below 2, and how to use this information,
click here.
Today’s featured stock is toy developer Hasbro
(
HAS |
Quote |
Chart |
News |
PowerRating),
which
showed up on our
2-Period RSI
Below 2
list last
Thursday, May 17. Hasbro has gained 69% over the past year and has a 52-week range of $17.00 to
an 8-year high of $33.43. HAS is a stock that can make major moves.Â
Our indicators display stocks like these on a daily basis, alerting you to
stocks that are ready to take off.
Let’s take a look at the
RSI indicator and the daily chart
to see how things played out. The first blue arrow is where we could have
made an entry at approximately $31.21 on 5/17/07. An exit could have been
made at the next blue arrow with a gain of 4% in just 5 sessions.
1-day later, HAS closed
-0.2%
2-days later, HAS closed +2.1%
5-days later, HAS closed
+4.0%
Obviously,
results like these do not occur every time, but
our quantified research clearly shows that the edges exist during extreme
oversold or overbought conditions.
Check out our
latest quantified research articles
here. If
you don’t already have a TradingMarkets subscription,
click here
for a free 7-day trial. Check back daily for more 7 Trading Ideas for Today,
and develop your own watchlist of stocks with historically-backed edges.
Darren Wong
Associate Editor
Reminder: We are in no way recommending the purchase or short sale of
these stocks. This article is intended for education purposes only. Trading
should be based on your own understanding of market conditions, price patterns
and risk; our information is designed to contribute to your understanding.