Adaptive Relative Strength & Static Relative Strength Scans

Also read : What is Relative Strength?

What Is Static Relative Strength (RS)?

Static Relative strength is a momentum indicator that measures the strength of the price movement of a stock vis-a-vis the benchmark index (Nifty/Sensex) over a period of 123 trading days.

If a Stock has performed better than the benchmark then SRS is positive, SRS 0 signifies exact same movement of the stock and negative ARS signifies Stock has underperformed benchmark index.

What Is Adaptive Relative Strength (RS)?

Adaptive Relative strength is a momentum indicator that measures the strength of the price movement of a stock vis-a-vis the benchmark index (Nifty/Sensex). The benchmark date considered here has been predefined by StockEdge based on the last major market trend change date. These dates can be seen by plotting ARS in Edge Chart.

If a Stock has performed better than the benchmark then ARS is positive, ARS 0 signifies exact same movement of the stock and negative ARS signifies Stock has underperformed benchmark index.

The indicator can also be used to compare two companies in the same industry or Index. This comparison examines the relative strength performance of two stocks with respect to their benchmark or sector and can help to decide whether one should hold, buy, or sell the other.

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1. SYSTEMATIC TRADING USING RELATIVE STRENGTH/MOMENTUM.
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Using Adaptive Relative Strength & Static Relative Strength in StockEdge App:

Above we have discussed the concept of the Adaptive Relative Strength & Static Relative Strength, now let us discuss how we can use this technical indicator to filter out stocks for trading:

In StockEdge there are mainly 6 scans available for filtering out stocks for trading:

Let us discuss in details about some of these scans:

1. Both SRS and ARS above zero:

This scan can be used to identify the companies which are strongly Outperforming the Benchmark Index, in the last 123 days as well as since the last ARS benchmark date.

2. Both SRS and ARS below Zero:

This scan can be used to identify the companies which are strongly underperforming the Benchmark Index, in the last 123 days as well as since the last ARS benchmark date.

3. Either SRS or ARS going above zero:

This scan can be used to identify the companies which are entering the bullish zone as either SRS or ARS is going above zero, i.e outperforming the benchmark index.

4. Either SRS or ARS going below zero:

This scan can be used to identify the companies which are entering the bearish zone as either SRS or ARS is going below zero, i.e underperforming the benchmark index.

5. SRS higher than 0 & ARS going above zero:

This scan can be used to identify the companies that have performed better than the benchmark index in the last 123 trading days and today ARS has turned positive today.

6. ARS higher than 0 & SRS going above zero:

This scan can be used to identify the companies that have performed better than benchmark index with respect to a predefined date by StockEdge based on the last major market trend change date and now SRS has turned positive today.

Above are examples of the latest Scans of Adaptive Relative Strength & Static Relative Strength that tell you if the stock is bearish or bullish and also give us a list of the stock which fulfills the criteria of the particular day.

Furthermore, to know the values of ARS & SRS, all you need to do is, type in the name of the stock in the search box, click on the stock and then click on the technical section of the stock, under this you have to click on the “Indicators” tab.

You will be able to see both the values of ARS & SRS along with the signal whether it is positive, neutral or negative.

For eg :-

You can filter out the stocks and can trade accordingly using these scans.

ARS-SRS scans are one of the few premium tools offered by StockEdge App which you can download from here.

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