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Setups – Green to Red

Overview​

The Setups – Green to Red profile identifies stocks that gapped up but have reversed downward intraday — falling back below the previous day’s close. These setups are ideal for catching short opportunities that meet strict volatility, liquidity, and structural risk/reward criteria. They also show no major support blocking the path to the AI-calculated downside target.

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This profile is updated in real time and applies filters automatically to surface reversal-style short setups that meet all structural and behavioral criteria. It is designed for use during the regular market session.

Strategy Focus​

  • Capture gap-up fades where price fails to hold early strength and breaks back below the prior close
  • Focus on short setups with a clear path to the AI-calculated downside target
  • Ensure setups meet minimum liquidity and volatility requirements for clean execution
  • Confirm breakdowns with volume context and theme/group alignment
  • Avoid noise by only including structured setups with strong short-side follow-through potential
  • Use in Multi-Charts or custom workflows for visual validation and trade planning

Filters Applied​

This profile applies multiple layers of filters to ensure setups meet structural, behavioral, and volume criteria:

  • Liquidity Rating > 70, ATRP 14D ≥ 0.5, Volatility (Month) ≥ 1: Ensures each ticker is sufficiently liquid and volatile to support short entries and sustained downside moves.
  • Volume All Hours ≥ 50K OR Relative Volume ≥ 2: Includes only actively traded tickers with either high total volume or abnormal relative activity.
  • AI - Alpha Strategy = Short: MarketAlpha AI must detect a short-biased setup based on real-time price behavior and structure.
  • AI - Risk/Reward ≥ 2, AI - Path to Target ≤ 1: Only includes trades where the reward-to-risk ratio is favorable and few support zones exist on the path to target.
  • Gap (%) > 1: Requires a gap up of more than 1% versus the prior close — a condition that often precedes a fade.
  • Last Price < Close -1D ($): Confirms that the gap-up move has fully reversed intraday — the essential signature of a green-to-red setup.

These combined filters ensure that every result represents a high-conviction gap fade with no major support below.

Metrics Used​

AI Strategy and Setup Quality​

  • AI - Alpha Strategy: Indicates AI-detected short setups with structural confirmation
  • AI - Risk/Reward: Measures downside potential versus stop level based on chart structure
  • AI - Path to Target: Shows how many support barriers remain to the target — setups must have ≤ 1

Price Action and Reversal Behavior​

  • Change Pre Market (%): Shows early session context that may have contributed to the initial gap
  • Change From Close (%): Tracks real-time reversal behavior relative to yesterday’s close
  • RSI Divergence 14 Days: Detects bearish divergence or momentum breakdowns confirmed by price and RSI behavior
  • Universal Pattern Detection: Confirms technical pattern alignment for short setups
  • Tight Range: Highlights setups emerging from recent consolidation phases

Volume and Liquidity​

  • Volume All Hours: Total trading volume across all sessions
  • Relative Volume: Flags tickers trading at unusually high volume levels
  • Dollar Volume Rank: Prioritizes liquid names based on capital turnover

Sector and Theme Context​

  • Industry Rating 1 Day, Theme Rating 1 Day: Show short-term group momentum to validate short-side bias
  • Industry Rating 1 Year, Theme Rating 1 Year: Identify long-term group weakness
  • Relative Strength 1 Day, Relative Strength 1 Year: Provide context on whether the ticker is underperforming both short and long term

Fundamentals and Timing​

  • MarketAlpha Rating: Composite view of overall strength and weakness based on AI models
  • EPS Rating, Sales Rating, Profit Rating: Help evaluate which names may lack supportive fundamentals for sustained price levels
  • Accumulation/Distribution Score: Reflects institutional positioning that may support downside continuation
  • 52 Week High (%): Shows how far price is from major highs — relevant for continuation or retracement risk
  • Next Earnings In Days: Useful to time entries relative to known catalysts

Default Sorting Logic​

Results are sorted by Dollar Volume Rank (ascending) to show the most active, liquid names first — ensuring that listed setups are highly visible and tradeable in real time.

Practical Use Cases​

  • Catch green-to-red reversals with structural confirmation and minimal noise
  • Filter for short entries where volume, trend, and support breakdowns align
  • Quickly build watchlists of gap-up failures across sectors and themes
  • Use in Multi-Charts to visualize fading momentum after strong opens
  • Layer with earnings or weak theme filters for higher conviction shorts
  • Combine with tight range or divergence patterns to isolate sharp breakdowns