How to find new leadership | stockbee

4/01/2014

How to find new leadership

Money finds new sectors to rotate in to during correction. That is what is happening right now.

Money has come out of  biotechnology , drug , China, and technology sector. Many of the stocks in these sector were up a lot in last six month , now they are having much needed correction. Some of them will go up again, some will never make it back to their high.

As a momentum trader and swing trader you have to look at where the new momentum leadership is developing. In any trading software it is not very difficult to do this.

In Telechart you can run a scan :

c/c10>=1.08 and minv3.1>100000 and c>5

Where
c= price today
c10= price 10 days ago
minv3.1= minimum volume in last 3 days as of yesterday

This gives you stocks that are up 8% plus in last 10 days. That gives you good idea of where money is flowing .

As a swing trader I look for 8 to 20% moves. This scan gives you stocks that in past 10 days had that kind of swing moves.

You can run a similar bearish scan :

c/c10<.92 and minv3.1>100000 and c>5

Besides the above two scan I also run a Dollar move in last 10 days scan to find stock up or down  at least 10 dollar. Higher priced stocks may not get captured in a 8% move scan, the dollar scan captures those movers.

If you go through stocks appearing in the two scans you can figure out where new leadership is no both bullish and bearish side.

No comments: