9/14/2009

How to find stocks with momentum

If you are short term swing trader, you need to be in stocks with momentum. Easy way to find such stocks in Telechart is by running a six month and two month momentum scan to generate a list of stocks.

In Telechart set up following PCF:

Six Month momentum
C / AVGC126
Two month momentum

C / AVGC42
Volume 3 days
MINV3.1 > 1000
In easyscan set up 2 easyscans
Six month momentum
Common Stocks
Six month momentum PCF set to list Rank >97
Volume 3 days =true
Price per share>3
Two Month Momentum
Two month momentum PCF set to list Rank >97
Volume 3 days =true
Price per share>3
Now look at the stocks in these two lists. These are the stocks currently favored by the market. To find trades from this you can sort the scan output by Price Percent Change 5 days and look at stocks with less than 5% price change in last five days. Those stocks are having a small pullback in their strong trend.

Here is a example of a quick swing trade on BEXP using this kind of momentum approach:



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