Published on: March 24, 2025
Hey traders, identifying the best trading opportunities quickly and accurately can be a game-changer. This is where the Smart RS Scanner comes into play—a tool designed to streamline stock selection by providing a comprehensive analysis based on multiple technical indicators. For traders, using such a scanner can dramatically improve decision-making, especially when it comes to identifying strong, high-performing stocks across various timeframes. Here’s how traders can leverage the Smart RS Scanner to select top-performing stocks.
What is the Smart RS Scanner?
The Smart RS Scanner combines multiple technical analysis tools and indicators to give traders a holistic view of a stock’s performance. It consolidates data from:
- Multi-timeframe Ratio: Provides performance insights on daily, weekly, and monthly timeframes.
- Fusion Matrix: This evaluates a stock’s total performance and relative strength using a scoring system that factors in price movement and strength.
- Relative Strength Indicator (RSI): This indicator shows a stock’s relative strength, helping identify whether it is overbought or oversold.
- MTF Ultimate Matrix: Evaluates performance across various box values, such as 0.25%, 1%, and 3%, to give a detailed view of stock movement.
Together, these tools offer a thorough analysis of price trends, strength, and performance, helping traders pinpoint the stocks with the highest potential for growth or momentum.
Using the Smart RS Scanner for Stock Selection
1. Analyzing Multi-Timeframe Performance
One of the standout features of the Smart RS Scanner is its ability to evaluate stock performance across multiple timeframes—daily, weekly, and monthly. This is crucial because different timeframes can tell different stories. For instance, a stock might show short-term bullish momentum but struggle over the longer term, or it may have stable, consistent performance over several months.
Traders can use the RS patterns shown for each timeframe to gauge the broader trend and identify stocks showing strength across the board. A stock that performs well on all three timeframes (daily, weekly, and monthly) is typically a strong candidate for investment. Conversely, if a stock shows a discrepancy in its performance (strong short-term but weak long-term trends), traders might consider caution or a more short-term strategy.
2. Evaluating Price and Relative Strength in the Fusion Matrix
The Fusion Matrix provides a combined score for Price and Relative Strength. It uses a unique formula based on several box values and calculates two key metrics:
- Performance Score: Measures how well the stock is performing in terms of price and relative strength.
- Ranking Score: Compares the stock’s performance against others in the market.
These scores are incredibly useful for traders because they not only show a stock’s performance but also give insight into how that stock stands in relation to others in the same sector or market. A high Fusion Matrix score indicates a stock that has outperformed others, making it an attractive choice for traders looking for the best-performing stocks in a given period.
3. Tracking the 15-period Ratio Trend Matrix Score
The 15-period Ratio Trend Matrix Score is a key indicator for identifying short—to medium-term trends. This metric looks at the past 15 periods (typically days) to determine the current trend’s strength and direction. A high score suggests that the stock is in a strong upward trend, while a lower score might indicate either stagnation or downward movement.
Traders can use this score to filter out stocks that are underperforming in the short term and focus on those showing consistent upward momentum. It’s particularly useful for swing traders who rely on short-term trends to execute their trades.
4. Multi-Timeframe Ultimate Matrix
The MTF Ultimate Matrix calculates stock performance across different timeframes using various box values, such as 0.25%, 1%, and 3%. This feature is particularly useful for identifying stocks that are showing stable movements over multiple periods. The multiple box values allow traders to see how a stock performs at different levels of movement, providing a deeper understanding of its price action.
By looking at this matrix, traders can spot stocks performing consistently across several levels of movement, which are ideal for those seeking a balance between risk and reward.
5. 120-Day Relative Strength Indicator
The 120-day Relative Strength Indicator (RSI) is another powerful feature that provides insight into how a stock has performed relative to others over the past 120 days. A high RSI value indicates a stock is overbought, while a low value suggests it might be oversold.
This metric can help traders assess the potential for price reversals or corrections. A stock with a high RSI might be due for a pullback, while a low RSI could present a buying opportunity for those looking to enter at a more favourable price point.
6. Trend Analysis on P&F Charts
The P&F (Point and Figure) chart pattern and moving average trend score evaluate price trends. These charts are great for filtering out market noise and focusing on key price movements. A strong score in this area signals that the price trend is solid, making the stock an attractive choice for traders who rely on technical patterns to make their decisions.
7. Performance-Based Ranking Score
Lastly, the performance-based ranking score provides a snapshot of a stock’s returns over different periods—60-day, 120-day, 180-day, and 240-day. This feature is particularly helpful for those seeking stocks with a consistent track record of positive returns over time. A stock with high returns over all these periods typically signals strong performance and low volatility, making it a prime candidate for long-term investment.
How to use the Smart RS Scanner?
- Login in the RZONE with the Super Demat Account UCC
- Click on the Menu > RS Scanners > Smart RS Scanner
3. Select the Group and Denominator
4. Here is the result
To learn more about the Star, Cats, Flying and more, you can read the book by Prashant Shah on Relative Strength.
Are you ready?
The Smart RS Scanner is invaluable for traders looking to enhance their stock selection process. Combining multiple timeframes, technical indicators, and performance metrics provides a clear and concise view of a stock’s overall strength and potential. Traders can use the scanner to identify stocks that align with their trading strategy, whether they are focused on short-term momentum or long-term growth. Ultimately, the scanner simplifies the stock selection process, making it easier for traders to make informed decisions.
