Trends/Relative strength, cycles and structure

Relative strength line new high

The ratio of the stock to the index reaches its highest level in a year.

Relative strength, cycles and structureBest on 1Y, 3YAlso called RS new high

Illustration of the relative strength line new high shape. It is a sketch, not real price data.

What it shows

Investor's Business Daily's William O'Neil highlights when a stock's relative strength line, the ratio of the stock to the market, makes a new high. We mark days when the ratio is at its 252-bar high.

It is a fact about the ratio. It does not require the stock's own price to be at a high.

How we find it

The same code that draws it on your chart follows these steps, with the same result every time.

Compute the ratio of stock to the S&P 500.
Find its highest value of the last 252 bars.
Mark when today's value equals it.
Show whether price is also at a high.

Starting values: Lookback 252 bars. These are proposed and will be tuned on real price data before launch.

How to read it

The panel shows the ratio.
The gold dot is the new high in the ratio.
Price may or may not be at a high.

Status labels you may see

Label	What it means
New high	Ratio at its 252-bar high.
Near high	Within 2% of the high.
Far	More than 2% below.

What cancels it

Ends when the ratio falls below the level.

What traders check next

Whether price is also at a high.
How long since the last RS high.
Benchmark.

Limits

Depends on the benchmark.
Not predictive on its own.
Needs a full year of data.

Try it in forecastviz

Open any ticker and choose Relative strength, cycles and structure → Relative strength line new high in the left menu.
Switch between 1Y, 3Y to see how the picture changes.
Compare with Relative strength ratio and Sector relative strength on the same chart.

Open on a ticker

Questions

Why does O'Neil like it?

He saw many strong stocks make RS highs before price highs. We make no claim.

Can RS lead price?

It can happen. It does not always.