Screener Strategy 3 – Find trending stocks.
To find stocks in a trend, we need to look at the price and technical indicators. Use any combination of these filters to see a list appropriate for you.
Price as a percent of 52 weeks high – if a stock is approaching a new high and getting stronger, it may be getting ready to make new highs.
- Volume surge – increasing volume on an increasing stock price is bullish.
- Gap Up – gaps up combined with increasing volume is bullish.
- MACD crossing up through zero – MACD crossing the zero line upwards is a positive sign of a trend
- Price crossing up through the moving averages – using moving averages is a way to filter for a strong trend.
- RSI crossing up through 30- like MACD the RSI can also help to uncover the underlying strength in a stock
- Stochastics oversold – a recovery of Stochastics under the oversold line is a positive indicator.
Volume spike – as we saw, a volume spike can indicate a change of trend. When a move is moving down and suddenly has a volume spike (blow-off bottom), this can be a positive sign.
- Gap Down – any gap down is usually a bad sign and potentially the start of a downtrend
- MACD crossing down through zero – this indicates a potential negative trend
- RSI crossing down through 70 – this can also signal a possible pullback in stock prices
- Volume spike – a volume spike at the top of a rally can indicate a reversal of the uptrend
- Stochastics overbought – Stochastics in the overbought section of the chart can mean a potential weakness to come.
A warning – none of the technical screeners or parameters is ever 100% correct. You must always have a suitable risk management plan in place and protect your losses.
Here you learned about how to stock screen. There are many screeners available, and your broker will also have tools for you to use. You also saw 23 examples of variables you can use in a screener to find the stocks you want. There are many more available.
Experiment and try new combinations to help develop your stock market strategy.
There are hundreds of in-built strategies to suit your investment style available within our recommended screener Stock Rover.