How To Reduce A Scan List Down To A Potential Trade List

I was a little blown away by how many stocks are holding well during this pullback in the major indexes. The Nasdaq 100 is down about 12% from the high, and the S&P 500 is down about 7.5%. Those are pretty typical pullbacks (so far). Most pullbacks of this size resume to the upside, as opposed to further downside.

stock market chart of S&P 500 futures

My scanners help me determine market health. They have basic uptrend and performance metrics in them, so when the list has few stocks on it, things are not good. But this week, there were quite a few. Glancing through, I wrote down about 40 stocks that required a closer look (out of about 150 on the full scan list).

swing trading stocks scanner criteria

This is scan I ran on StockRover. The scanning process is important, and so is figuring out which stocks to focus in on. So for those of you who are interested in how a list of stocks gets narrowed down, I have included my “rough list” below. This is the list that gets a second look. I jot these stocks down as I quickly go through my scan list.

I then narrow this list down to a handful of stocks. Basically, I come up with a list of the stocks I think have the best setups (for the strategies I trade) and that are closest to forming valid patterns and breaking out.

If I skipped a stock, it doesn’t mean I don’t think it can’t go higher or that it is going to drop. It means it didn’t quite meet my strategy parameters for a cup and handle or continuation pattern at this time. Additionally, it may still be forming the pattern, but hasn’t quite fully formed the handle and/or consolidation, yet. In this latter case, maybe it will make it to the watchlist next week.

For the Rough List below, if I didn’t include it on the Final List, I put a description as to why. Stocks that made it to the Final List have an asterisk after their entry. The Final List is the list of stocks that I would consider putting orders in if they breakout higher without any issues with the patterns (many have issues, currently).

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Disclaimer: Nothing in this article is personal investment advice, or advice to buy or sell anything. Trading is risky and can result in substantial losses, even more than deposited if using ...

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