Stock Scanning techniques

Hi Friends,

I am opening this thread to know more about stock scanning techniques. While many of us here know about technical oscillators and trading techniques (thanks to Saint, Karthik and many others).. I believe we can all learn a lot more if we can share our respective stock scanning techniques.

I mean.. what could be the first step to identify if a stock is peaking? Do we scan volume (I mean.. stocks which have risen abnormally in volumes), do we look for oversold stocks (with RSI, ROC in oversold Zone) or do we look for MACD crossover?

We all have different techniques for scanning stocks.. for instance, I personally look at oversold stocks.. and look for trend reversal.

Can we all share our stock scanning techniques.. and share them for the benefit of others?

Thanks to everyone in advance,
Srikanth

Oversold stocks will exhibit short term corrections more commonly than trend reversals

If you have been able to spot medium/long term trend reversals, and consistently several times, you are talented and need to share your expertise

AGILENT

Hi Agilent,

Let me confess.. I have been mildly successful.. I keep stocks for a period of 5 days - 2 weeks. As soon as a stock reaches close to overbought limits.. I sell out.

This has not been very successful.. and hence.. i wanted to know how could we scan stocks for analysis? What should be the first step?

It would be nice to know your stock scanning technique.

Thanks in advance,
Srikanth

I have been into share trading for the past two years. I think 4 or 5 indicators like MACD,EMA,RSI,Candle stick analysis etc , combined with Fundamental analysis will help identifying stocks which can yield 5 to 10% yield from two weeks to one month.

But a winning strategy definitely involves data gathering and lots of homework coupled with 1) Patience 2) No greed

One must concentrate on a selected basket of stocks . while looking for short term gains, one must also analyse the stocks in question for long term perspective.

I am also in a learning phase, I have collected so much of .PDF files and information on this.
Presently I am going through this, and think a best strategy will emerge probably after one year or so.

What all magazines, experts etc advise is : Devise your own method, stick to it religiously. Also
invent various other ways and test them from time to time.

Definitely!

Out of all materials I have collected , the following illustration of how one must be towards share trading impressed me very much:

In foreign countries people use big traps to catch birds and animals which destroy the corn fields.
I have forgotten the name of the bird and the animal but it is of insignificance. The moral is :
1. The birds , as soon as they spot the food inside the 'trap' lunge for it and get CAUGHT !
2. Whereas the animal, looks at it from a distance, moves the trap here and there, sees whether the food inside SPILLS over and if so , EAT it without getting CAUGHT

The market is like the 'trap' . We traders/inverstors should be like the ANIMAL which turns the trap for the food to spill over.

Srikanth
I keep stocks for many months , and this is one of my scanning methods
http://www.traderji.com/36998-post5.html

Some will advocate a diametrically opposite technique ( buy 52 week lows !) but then ... one man's meat is another's poison

Good luck to them , and hope you are wise enough to formulate your own technique, without trying to ape any of us

Cheers

AGILENT

Hi Agilent and Spstrade,

Thanks for the information.

And yes, I agree with both of you that we should devise our own technique, rather than imitate others.

The market does teach you a different lesson every day.

Thanks and Regards,
Srikanth

Hi
the first thing about TA is that one shud not look for a holy grail.. that is u cant 'trust' an indicator. For any indicator there can be many ways to use it.. like MACD can be used for hooks, crossover, divergence, or to detect wether the market is trending or not. To learn the use there is only one way... thorough backtesting. 50 books thru rapidshare or 5 gurus dont help.

All successful traders on board have their devised screeners... but I dont think they will post it publicly. Best wishes for working out your own.

..........

believe me, if all the gurus give out their devices here, still u'll not be able to make any money..it has to ultimately fit ur personality and money management

Yeah, too many gurus can spoil the trade