Bearish Screener

Description of Bearish Screener

Bearish companies' data helps identify companies with bearish price signals as per technical indicators. This companies’ data screen is developed based on key technical indicators and price parameters such as Relative Strength Index (RSI), Simple Moving Averages (SMAs), Moving Average Convergence/ Divergence (MACD), Directional Movement Index (DMI) and Volume.

A company's share price is said to be bearish when it declines continuously and struggles to move up. Typically, in a bearish market, some investors may prefer to stay on the side-lines, while some investors may look for opportunities to buy quality shares at low prices for long-term holding.

There are various technical indicators to identify bearish trend in a company’s share price. For instance, when the current price of a share trades below its 50 DMA or 200 DMA and 200 DMA is less than 50 DMA, the stock is in a bearish trend.

Definitions:

Relative Strength Index (RSI): RSI is a leading momentum indicator developed by J. Welles Wilder. It moves in a range of 0 to 100 and due to the range-bound feature, it is also known as an oscillator. As per Wilder's definition, a reading above 70 levels is considered overbought, whereas a reading below 30 is oversold. The default period of RSI is 14 days and can be used in different ways for analysis perspectives such as divergences, overbought, oversold, and centerline crossovers.

Moving Average Convergence/ Divergence (MACD): MACD is a trend-following (lagging) indicator Developed by Gerald Appel. It is an oscillator that fluctuates above and below the centerline (zero value) and includes a MACD line and a signal line for representation. MACD is used in three ways to confirm the trade signal, i.e., centerline crossover, signal line crossover, and divergence.

Simple Moving Average: A Simple Moving Average (SMA) is a widely used trend-following (lagging) indicator based on the past price. It also serves as the basis for other technical indicators and thus keeps an important place in technical analysis. It is the average closing price over the specified timeframe. The 10, 20, 50, 100, and 200 periods are the most common time frames used when creating moving averages. It can identify a stock trend and support/ resistance levels.

Volume: Volume represents the number of shares or contracts that have been traded in a particular period. In simple words, the volume is the number of shares that changed hands during a given period. Stocks with high volumes are considered more liquid, and liquidity in stocks helps in easier and faster execution of the order. The volume is displayed by histogram and is usually available below the price action on a standard chart.

Frequently Asked Questions (FAQs)

1. How to identify companies with bearish trends?

Ans. Typically, when a company's share price falls nearly 15-20% or more from its recent peak, it is said to be in a bearish trend. A downward trend on price chart with lower highs and lower lows may indicate a share is in a bearish trend. Likewise, other technical indicators are also there to identify bearish trends.

2. Does this screen show companies’ data from a particular sector?

Ans. No, this screen includes companies from across the sectors and market capitalisation.

3. What do the Consensus Ratings and Consensus Mean Target Price of a company indicate?

Ans. The consensus mean target is deduced using statistical averages of broker estimates determined to be on the majority accounting basis and is provided by the licensed data provider. The price target is the projected price level forecasted by the respective analyst(s) within a specific time horizon.

The mean consensus rating is based on the data provided by the licensed data provider. The Consensus Rating is based on the Standard Scale of 1) Strong Buy, 2) Buy, 3) Hold, 4) Sell, and 5) Strong Sell.

Directional Movement Indicator: The Directional Movement Indicator (DMI) is a movement indicator developed by Welles Wilder based on Plus Directional Movement Indicator (+DMI) and Minus Directional Movement Indicator. The +DMI and -DMI are calculated by comparing the difference between lows and highs and help in the trend's direction and strength analysis.