Our resource page providing you with a curated collection of Traders Links has several screeners that will allow you to dial in your own collection of stocks to target in whatever your trading style or timeframe may be. Finviz's offers a free screener that many trading professionals utilize. We highly recommend that you utilize this free resource to evaluate your stock targets as well as identify new opportunities.
SCREENING FOR STOCKS:
1) Produce a pre-screened list of candidate stocks utilizing the FinViz Screener. This will produce a list of stocks that all meet your criteria for both safety and potential profitability.
2) Look for stocks performing well when markets are down. Screen them and add them to your list. These stock have strength relative to the other stocks in this declining market. Conversely, when the markets rebound, these same stock are the most likely candidates to demonstrate the most upward momentum within the new market direction.
3) Categorize you pre-screened stocks by Segment/Industries.
4) Watch for Markets to turn positive.
5) Select stocks from you pre-screened list, and from the market segment that is currentely performing the best.
6) FinViz allows you to set the minimum number of shares traded each day. This is critically important. Stocks with limited liquidity can trap you like quicksand. You get stuck in the trade as your equity keeps sinking lower and lower. If you screen for at least 250,000 you should be able to freely trade in and out of the equity at any time the markets are open.
7) A stock's price is determined by markets, i.e., supply and demand and fear and greed, but those markets are pegging the stock price on some multiple or level of future earnings. The dilution or the total number of shares can confuse this issue, but a simple rule to help you stay away from dangerous stocks is to set a price threshold that you do not go below.
Think of this way, a penny stock is 10,000 time more risky than any stock trading above a dollar. A dollar stock is a 1,000 times more risky than a stock trading around or above $10.00.. A $10.00 stock is 100 times more risky than a $100.00 stock. FinViz also allows you to determine what level of risk reduction you want from your minimum price range.
A higher price will reduce your risk, it will not, in any way, guarantee that you are entering a safe trade. There is no such thing.
8) FinViz provides to trader's a large number of screening values to chose from in dialing in a custom list of parameters to help you select a reduced level of risk in the stocks you target to trade. These include Descriptive, Fundamental and Technical parameters.
MY FinViz VOLUME-SPIKE STOCK SCREEN
1) On the FinViz Screener page under the Descriptive tab (highlighted in yellow in image at the top of this page) select the fellowing three parameters: Average Volume; Relative Volume and Price. I look for stocks with a minimum of 200,000 shares traded each day, and a price above $5.00. You can then utilize the Relative Volume to selectively narrow the number of stocks returned to you by increasing the X-level of this field.
2) Using the Technical tab just to the right of the Descriptive tab select Performance (also highlighted) in the upper left hand corner and select up or down depending on you current strategy of going long or short. In the upper right side of the same page select from either: Change; Pattern; Gap; Change from Open or Candlestick. You can dial in exactly what you are looking for in a target of opportunity. I often just select any gap up as an indication of positive momentum.
3) This screen will provide you with a list of stocks that have something going on, as evidenced by both the gap up and confirmed by an increase in relative volume. This is a very fertile list of potential stocks that provide excellent candidates to further develop and research.
3) Finally drop down the "New Screen" (it may say) "My Presets" menu and select, "save screen." This enables you to alway retrieve these exact same parameters without having to re-enter them.
TRADING STOCKS: GENERAL RULES
1) If you are going to buy it, or if you have already bought it, learn as much about the company’s business as you can. The more you know about any stock you own, the more insight you will have in making entry and exit decisions. I consider three areas of analysis when researching stocks. Fundamentals or the companies financials, Technicals by analyzing how the stock has and is trading and finally sentiment. What are traders saying about this stock.
2) Zoom in and out on you stock candidates chart to see what the longer and shorter trading times frames are doing. Often stocks can look like good canidates with good entry points until you zoom out to a longer time frame and see that this stock is in a strong, long-term, down trend. Looking at shorter term time frames than what you intend to trade will also assist you in determining if you want to enter this stock and when during the day is the most opportune time to enter this stock.
3) Always maintain awareness of where you stock is relative to the following:
5) News > Situational Awareness