Signal Library
Technical ReferenceEvery signal in the Elite Engine, the market context that shapes how to read them, and the framework for interpreting what you see on the dashboard. This is the definitive reference for how Signal52 evaluates stocks.
Pipeline v1.2.0 • Data: 2026-03-05
The Scoring Framework
Three signal categories work together to produce every score on the dashboard
Build the Foundation
DNA signals identify stocks with underlying structural quality: strong relative strength, persistent momentum, institutional accumulation patterns, and consistent price behavior. They answer: does this stock have the right stuff?
Pull the Trigger
Action signals detect timing patterns: breakouts, volume surges, momentum accelerations, and confirmed entries. They answer: is now the right time to pay attention?
Raise the Flag
Risk signals warn of potential problems: overextension, distribution patterns, and fading momentum. They answer: what could go wrong even if the score looks good?
Each active signal contributes weighted points based on its historical edge and category. The final score is the sum of all active signal weights, reflecting total setup quality. A score of 10+ with no risk flags is a fundamentally different setup than the same score with active warnings. Context matters, which is why the market backdrop below is essential reading.
Market Backdrop
How regime and volatility change what signals mean on any given day
Signals don't exist in a vacuum. The same DNA + Action combination that produces a clean breakout in a Risk-On environment may fail to follow through in Risk-Off conditions. Signal52 classifies two layers of market context daily, regime and volatility, and both should inform how you read the signals below.
Growth and momentum are being rewarded. DNA and Action signals are at their most reliable. High-confluence setups have the strongest expected follow-through in this regime.
The market is rotating defensively. Even strong signal combinations can stall or reverse. Risk signals carry extra weight here. Treat every warning flag more seriously than usual.
No dominant macro trend. Signals remain useful but require higher confluence to be meaningful. Individual stock quality matters more than market direction.
Regime in transition. Expect lower signal reliability across all categories. The market hasn't decided its next direction yet. Wait for regime clarity before weighting signals heavily.
Volatility is coiling, a classic pre-breakout environment. Breakout and momentum Action signals tend to be more reliable here. Watch for the release.
Normal conditions. Standard signal weights apply. This is the baseline state where historical signal edge data is most consistent and representative.
Rising volatility widens intraday ranges. Risk signals (Extension, Distribution) are highest-risk in this state. All signals carry more noise. Size positions accordingly.
Maximum signal reliability. DNA + Action combos have the strongest expected follow-through. This is the ideal environment for trusting high-confluence scores.
No macro tailwind or headwind. Signal performance tracks historical averages. Focus on the highest-confluence setups and let the individual stock quality do the work.
The worst combination for signal reliability. Even top-tier scores carry elevated failure risk. Risk flags should be treated as disqualifying rather than cautionary.
Today's regime and volatility state appear on the AI Insights page and in the Daily Briefing header.
DNA Signals
Foundational strength: the stock has the right structural qualities
+50% gain in 40 days with controlled pullback and tight consolidation
Within 2% of 52-week high. Shows relative strength leadership
Near high + low volatility + quiet volume for 10+ days. Coiled spring
8+ of last 10 days above 10-day SMA. Orderly uptrend
50 SMA above 200 SMA. Long-term bullish trend state
Bollinger Band width at 6-month low. Coiled spring ready to expand
Relative Strength vs SPY at 52-week high. Confirms market leadership
Perfect MA stack: EMA8 > EMA21 > SMA50 > SMA200. Strong trend
Action Signals
Entry timing: something is happening right now
Up day volume exceeds all down-day volume from last 10 days. Stealth buying
Volume below 50% of average while near highs. Supply exhaustion
New 52-week high after 20+ days of consolidation. Classic breakout
Bounce off SMA support with buyers stepping in
Price pulled back to key support and bouncing with momentum
MACD crosses above signal line from below. Momentum shift confirmed
Stochastic crosses above 20 from oversold. Buy signal
Narrow range day followed by expansion. Coiled spring release
Gap up on high volume. Strong institutional buying
Bearish engulfing pattern - contrarian BUY signal. Stocks bounce back
RSI(2) below 5 while price above SMA200. Extreme oversold in uptrend - buying the dip
RSI(14) crosses above 30 from oversold while price above SMA50. Momentum reversal confirmed
ATR at 60-day low then range expansion with green close. Volatility squeeze breakout
Risk Signals
Warning flags: proceed with extra caution when these are active
Close in bottom 20% of range. Weak finish, potential reversal
Up 25%+ above 50 SMA. Parabolic move, high risk of pullback
Price up but volume heavy. Institutions may be selling into strength
High volume but no price progress. Supply overwhelming demand
RocketShips Lens
RocketShips is a lens, not a signal. It narrows the entire stock universe before any signals are evaluated, showing only stocks that have persistently closed at 52-week highs.
How many times a stock closed at its 52-week high within the selected period: 7, 14, 30, 60, or 90 days. Stocks with high hit counts are the market's sustained momentum leaders.
A lens changes which stocks appear in the table. A signal evaluates individual stocks within whatever universe is active. They're complementary. Enable RocketShips, then filter by signals on top.
Quick Reference
Reading Signal Combinations
How to interpret common patterns you'll see on the dashboard
Multiple DNA signals active plus at least one Action trigger, with no Risk flags. This is the highest-quality combination: structural strength with confirmed timing.
Strong signal confluence but one or more Risk chips are active. The positive signals drive the score up, but the risk flag changes the character of the setup. Extra scrutiny is warranted, especially in defensive regimes.
Action signals are active but DNA is limited. Good timing signal, but the underlying structural foundation is weaker. These often land in the Watchlist band (3-5) and benefit from additional confirmation.
Price may be stretched above its normal range. Breakout entries here carry elevated reversal risk.
Institutional selling pattern detected. Smart money may be exiting while the price still looks stable.
Intraday gains faded into the close. The bulls couldn't hold, a warning at any score level.
Best conditions. The market is rewarding exactly what these signals identify.
Even strong setups can stall in defensive regimes. Raise the bar before acting.
Regime in flux. Wait for clarity before weighting any signal combination heavily.
Pre-breakout conditions. Breakout and momentum signals are most actionable here.
Technical Methodology
How the Elite Engine processes market data every evening
4-phase analysis each evening:
FRED indicators driving regime classification:
Disclaimer
Signal52 is for educational and informational purposes only. The signals, scores, and narratives are generated by automated systems and AI. They are not personalized investment recommendations. Past performance does not guarantee future results. See our full disclaimer.