The Recipe of finding stocks to trade

Put in the search for stocks after hours. Tomorrow’s best trade can be found today including multi day runners. Run scans everyday even if able to trade or not watch what the stock does that day.   Sometimes not every box in the checklist can be checked. 

Also experiment with stocks. Build plans. Print charts and review and review. 

  • Use Screeners either built in or custom 
    • Goal is to build the case 
    • Find the guilty suspect 
    • Find stocks to trade tomorrow 
    • Find that one stock to trade 
    • Try to shortlist them down to 5 or less, dump rest 
  • Check Chart History 
    • Depending on current market, like for 2019 it is still a bull market so 
    • Look for new highs like 1 year high, 2 year high 
    • Look for former runners, that made a hit in the past 
    • If not ran in the past, don’t pick (note can still trade but riskier)  
  • Check Catalyst 
    • Has to have a catalyst 
    • Avoid stocks that go up on no news 
  • Check Sector 
    • Is it a hot sector? 
    • How to find a hot sector? 
  • Check Volume
    • Need unusual volume  
    • Unusual volume brings unusual price action
    • Not even slightly above average, gone
    • Look for volume 2x or 3x as this help continue moves for multiple days
    • Not an exact science but ignore those that do not trade at least 1 million stocks per day 
    • Look for multiple 60 day average volume
  • Check Float 
    • Apply mainly to day trades
    • Less than 10 million on the float
  • Check Market Sentiments (important but least important) 
    • Is overall market moving on the day? Like up or down
    • Be careful buying breakouts if overall market is down might want to look into shorting instead
    • Use SPY to track overall market sentiments