Trend leaders

RS Line New High

From William O'Neil (Investor's Business Daily)Read about it

The relative strength line divides a stock's price by the index. William O'Neil found that market leaders' RS lines often reach new highs before their prices do. A signal comes when the line against the Nifty 500 hits a 52-week high while the stock is in an uptrend.

Yearly return, after costs+17.8%Nifty 500 +11.5% over the same years

Worst fall−60.7%Win rate32%Matches now26

How it works

The signal every rule true at the close

Relative strength line (close ÷ Nifty 500) reaches a 52-week high
Close above the 50-day average, and the 50-day above the 200-day
Within 15% of the 52-week high

The exit whichever comes first

Closes below the 50-day moving average
Or closes 8% below the price the trade opened at

Typical holdingWeeks to months

An example from the backtestAther Energy ATHERENERGThe rules were met at the close before 9 Jul 2026. The trade opened that morning and closed on 29 Sep 2026, 57 trading days later, +20.0% after costs. Exit: closed below the 50-day average.

Stocks meeting the rules 26

At the close of 1 Oct 2026, among NSE's 500 most-traded stocks. A screen, not a recommendation: in the backtest, a trade opened at the next day's open.

Backtest

1 Jan 2016 to 1 Oct 2026: a 10-stock portfolio following these rules on NSE's 500 most-traded stocks at each date, after 0.2% costs on each side, against the Nifty 500 index.

Yearly return+17.8%Index +11.5%

Compound growth a year (CAGR).

Total return+481%Index +224%

Gain or loss over the whole test.

Worst fall−60.7%Index −38.3%

Largest drop from a high (max drawdown).

Win rate31.7%

Share of trades that closed with a gain.

Profit factor1.57

Rupees gained for every rupee lost.

Average trade+2.88%

Average result per trade, after costs.

Average gain · loss+25.2% · −7.4%

A typical winning and losing trade.

Days held28.1

Average trading days per trade.

Trades916

About 85 a year.

Sharpe ratio0.81

Return for each unit of ups and downs.

Time invested98%

Average share of the money in trades.

Best · worst trade+306% · −37%

The extremes, after costs.

₹1 lakh following the rules

1 Jan 2016 to 1 Oct 2026: ₹5.81 L against ₹3.24 L in the Nifty 500.

RS Line New HighNifty 500

Falls from the high

Worst in this period −60.7%

Each calendar year

Return in the year, after costs.

RS Line New HighNifty 500

How the 916 trades ended

Each trade's return after costs, grouped.

GainLoss

How sturdy is it?

The same rules, tested again with one thing changed. A result worth trusting holds up across these; a big swing means the headline figure depends on luck or on the exact setup.

Beat the Nifty 500 in 4 of 5 versions and in 2 of 2 halves of the test.

Version	Yearly return	Worst fall	Win rate	Profit factor	Trades
As published10 stocks at a time, 0.2% costs on each side	+17.8%	−60.7%	31.7%	1.57	916
With the market filterNew trades only while the Nifty 500 is above its 200-day average	+17.8%	−54.6%	35.4%	1.73	653
Costs doubled0.4% on each side, as slippage in thinner stocks can be	+14.2%	−64.2%	30.7%	1.46	915
5 stocks at a timeA bigger share of the money in each trade	+7.2%	−69.1%	29.7%	1.31	485
20 stocks at a timeA smaller share in each trade	+17.4%	−53.0%	31.7%	1.58	1,767

First half · 1 Jan 2016 to 21 May 2021

Strategy+24.0%/yr

Nifty 500+12.8%/yr

Ahead of the index by 11.2 points a year.

Second half · 21 May 2021 to 1 Oct 2026

Strategy+11.9%/yr

Nifty 500+10.3%/yr

Ahead of the index by 1.6 points a year.

Recent trades in the backtest

The last 12 trades the rules closed, with 10 still open.

Stock	Opened	Closed	Days	Return	Why it closed
Paisalo DigitalPAISALO	22 Sep 2026	29 Sep 2026	5	−15.3%	8% below the opening price
Ather EnergyATHERENERG	9 Jul 2026	29 Sep 2026	57	+20.0%	Closed below the 50-day average
Anand Rathi WealthANANDRATHI	6 Jul 2026	28 Sep 2026	59	+2.7%	Closed below the 50-day average
CupidCUPID	27 Apr 2026	22 Sep 2026	102	+120.3%	Closed below the 50-day average
Rashi PeripheralsRPTECH	2 Jul 2026	26 Aug 2026	39	+0.2%	Closed below the 50-day average
Adani Energy SolutionsADANIENSOL	15 Jul 2026	13 Aug 2026	21	−5.8%	Closed below the 50-day average
Thangamayil JewelleryTHANGAMAYL	9 Jun 2026	3 Aug 2026	38	−6.3%	Closed below the 50-day average
Acutaas ChemicalsACUTAAS	30 Jan 2026	27 Jul 2026	118	+69.0%	Closed below the 50-day average
Bajaj Consumer CareBAJAJCON	13 May 2026	16 Jul 2026	44	+3.5%	Closed below the 50-day average
Ramco SystemsRAMCOSYS	14 Jul 2026	15 Jul 2026	1	−6.4%	8% below the opening price
Sterlite TechnologiesSTLTECH	4 Mar 2026	14 Jul 2026	87	+196.4%	Closed below the 50-day average
Apar IndustriesAPARINDS	12 Jun 2026	9 Jul 2026	18	−9.5%	Closed below the 50-day average

How the tests work

Universe. The 500 most-traded NSE stocks at each date, by six-month average traded value, re-ranked every month: 1,353 different stocks over the years, 131 of which no longer trade. Testing all of them, not only today's survivors, keeps the results honest.
Period. 1 Jan 2016 to 1 Oct 2026, after a year of history for the long averages, on NSE's own end-of-day files: prices, delivery and futures open interest.
Portfolio. 10 slots, each a tenth of the portfolio's value when a trade opens. A signal at a day's close opens at the next day's open; an exit rule met at a close closes the trade at the next open. When there are more signals than free slots, the strategy's own ranking decides.
Costs. 0.2% on each side of every trade (STT, stamp duty, exchange charges and slippage). Tax and DP charges are not included.
Market filter. Every strategy is also tested opening new trades only while the Nifty 500 closes above its 200-day average. At the last close it was below it.
Robustness. Each strategy is run again with costs doubled, with 5 and with 20 stocks at a time, and judged separately in each half of the test. A result that only holds in one setup is luck, not an edge.
Corporate actions. Splits, bonus issues and demergers are applied from NSE's corporate-actions list, and symbol changes are joined up, so none of them shows up as a gain or a loss.
What is left out. Dividends (as in the Nifty 500 price index it is measured against), taxes, and the chance that a large order moves a thinly traded price.

Swing Lab is a screen and a history lesson, not advice. RupeeVerse is not registered with SEBI as an investment adviser or research analyst. A stock meeting a strategy's rules is not a recommendation to trade it, and past results do not predict future ones. Do your own research.