How to find a hot stock pick for free for short term or intra day stock trading
I’ve received several requests to provide more info about some stock market screener ideas. I have used several different types of market screeners during my trading career. So I have tested different ideas how to find free day trading picks and short-term market picks using a market screener.
Finally I found quite simple principles that I started to use in every my stock market screener. Here I would describe stock selection idea that is especially useful for short-term traders and but also for traders with day trading accounts.
These traders need to find stocks where there’s some momentum building to realize short-term trades. So, the most important task is to find the answer to the question, “How can one spot building momentum?”
How to spot building momentum in market screening software
The simple answer is watch the volume. Unusual and high volume levels are a strong signal that big players, institutional investors and money funds are active in this ticker. It can be associated with both types of price movement, a rising price for long trade and a declining price for short-type trade.
The key idea is to spot this unusual volume as soon as possible. I use Amibroker, technical analysis software to do this.
Traders can build their own database of stocks for monitoring. It’s possible to have a database of all U.S. stocks, or a database can be based on the European markets like the Frankfurt or the London exchanges.
This database must be connected to some real-time data provider that scan in real time. Or you can use EOD data from free data providers like Yahoo for End of Day scanning.
Then use the automatic analysis function of AmiBroker to run a market screener. Choose the file with a high volume formula defined. Here is a description of this formula:
TimeFrameSet( inDaily );
Cond1= Volume > MA( Volume, 20 );
TimeFrameRestore(); // restore time frame to original
Filter = TimeFrameExpand(Cond1,inDaily);
AddColumn( Close, "Close " );
"Volume " );
Run it. This screener should provide a list of stocks with above-average volume. And this list should contain ten top stock picks for the current or the next days.
Like this example:
This short tutorial describes how to create a screener in AmiBroker if you need some guidelines.