I like to look closer into stocks that are showing bullish divergence on the daily timeframe. However I can never seem to find the best screener for finding these stocks.. Anyone got any ideas on the best screener settings for finding such divergence, or if its even possible?
I doubt if there is a screener. Your best bet is to look for stocks with a high momentum score and high relative strength (relative strength is quite different from RSI as you probably know), and then look for bullish divergence, if you really think that's a sound basis for buying or selling. (MACD is a much simpler indicator. ) Bullish / bearish divergence is quite useful to identify the start and end of short term trends, but I suspect that it's mainly index traders who use it. The easiest way to identify RSI divergence, IMHO, is to look at the 5 day EMA against the RSI over a time scale of 10 or 20 days. If the 5 day EMA has dropped, and the RSI has risen, you have a bullish divergence. If the 5 day EMA has risen, and the RSI fallen, it's bearish. Take a look at something like Advanced Micro Devices (NSQ:AMD) and you'll see excellent momentum and relative strength. (This is an example, not a recommendation.) Best wishes.
