Do you want to quickly find top trading opportunities each day with just a few mouse clicks? Do you want to shave hours off your pre-market analysis? Do you want to start the market day prepared and focused?
If your answer is yes to any of those questions … you need to learn how to use a stock scanners in your trading process.
New to trading or scanning? Read on to learn about the different types of scans, smart practices for scanning, how to use scanning in your trading strategy, and more. Here’s how a scanner can help you streamline your trading day.
What Exactly Is a Stock Scanner?
Let’s opt for some clarity for we dive right in. What is a stock scanner?
A stock scanner is a computer program that scans the stock market. You set it to search for criteria that meets your trading style.
Wanna find stocks trading at all-time highs? Stocks trading at unusually high volume? Maybe you want stocks that crossed the 50-day moving average … A stock scanner can find them for you almost instantly.
In the pre-internet days, when retail traders didn’t have scanning software, finding exciting high-potential stocks was a chore. Imagine clicking through thousands of charts, using clunky software for hours before the market opened each day.
Not a fun, consistent, or reliable way to find stocks to trade.
If you’re a trader who values both your time and sanity, you should seriously consider using a stock scanner every day. It can help you save time and effort. It can help you find and focus on trading opportunities that fit your methods.
Check it out for yourself … Try the StocksToTrade scanner with a 14-day trial for just $7!
The Different Types of Stock Scanning
So now you better understand what a game changer stock scanning software is. But before you jump in and start scanning, it’s important to understand the many types of scans you can run.
Here’s a brief rundown of the most popular ways to scans:
Fundamental Stock Scanning
Fundamental analysts use — you guessed it — fundamental stock scans.
So what is fundamental analysis? It’s thoroughly researching a company — its earnings, sales data, assets and liabilities, profit margins, and much more.
Running a fundamental scan can be as simple as setting the scanner to return a list of all the stocks trading below a 15 price-to-earnings ratio. And you can run more complex scans from there.
Once the scanner returns a list of stocks that meet your criteria, you can then delve deeper into analyzing these companies. Just think of how much time using a scanner can save you…
Technical Stock Scanning
Technical scans search for certain technical analysis criteria: chart patterns, trading volume, price action, and technical indicators.
Deciding which technical criteria to scan for depends on your trading strategy. It can be as simple or as complicated as you like or need.
For example, you can run a super simple scan for every stock trading above its 200-day moving average … But you’ll likely get a huge list of stocks!
So maybe raise the bar and run a more complicated scan: You set the scanner to search for all stocks trading above their 200-day moving average, with a trading volume of over $1 million per day, on a company with a market cap under $50 million. The scanner will likely return a much smaller list.
That’s just one example. No matter what you scan for, the process can help save you time so you can focus more time and energy on analyzing the opportunities.
Post-Market Stock Scanning
Post-market scanning is scanning after the market close.
After the market closes for the day and the dust settles, you can see which stocks were the biggest gainers in price, which had the biggest volume increases, and so on.
Traders can conduct post-market analysis to better understand what’s happening overall in the market. They’re looking for insight as to where to focus in the next trading session. That can mean looking for things like new sectors trends, stocks breaking to new highs, and more.
Intraday Stock Scanning
Intraday scanning involves scanning the market for opportunities while the market is open and traders are active.
Intraday scanning can involve either fundamental or technical analysis (or both), but most traders generally look for criteria that may indicate if a stock will make a sudden price move during that session.
That’s why many traders scan intraday for the biggest price movers or stocks breaking to all-time highs, and so on. During the trading day, thousands of stocks move up and down every second. There are numerous moving parts and tons of price data.
That’s exactly why it’s so important to use a reliable, robust, and high-speed stock scanner. Many top stock traders rely on StocksToTrade for their scanning and trading needs. See why — grab a 14-day trial for just $7 today!
Tips for Using a Stock Scanner
Scanning software can help you streamline your trading day. But you have to remember that it’s just a tool. As with any tool, the results depend on your skills and knowledge.
So to help you learn how to use a scanner, here are a few helpful hints:
Scan for Opportunities Intraday
If you solely trade intraday, it should go without saying that you should scan for opportunities intraday.
But it can also be wise to run intraday scans even if you’re not an intraday trader…
Why? It can help you get the first-mover advantage when a stock sets up the right way.
Most longer-term traders only scan the markets once a day, after the market closes. If a stock looks exciting, they aim to enter a trade the next morning, possibly after the stock starts to move.
By scanning intraday, you can be one step ahead of the slower traders. That’s a solid reason to run scans while the market’s open. You can also set up alerts to notify you if the scan locates your desired setup.
Time Your Entries Using Chart Patterns and Price Action
There are many reasons you may want to enter into a stock trade.
It may be because the company is fundamentally sound and you want to hold it long term. Maybe there’s an exciting news story, and you’re confident the market will move on the stock.
Whatever the reason, it’s wise to look at the chart before entering into any trade. There are countless benefits to using charts to help you time your trade entries. Here are just a few:
- Charts can help you spot uptrends and downtrends so you can stay on the right side of the market.
- Charts can indicate if the market’s buzzing about a stock and if there’s likely momentum around it. This can help prevent you from committing your capital to stagnant stocks.
- Charts can help you determine levels for your stop-loss, entry, and exit orders so you can make smarter trades.
So next time you’re looking to enter a trade, look at the chart first and scan for signs that the market momentum supports your theory.
Don’t have a great charting platform yet? Check out the top-of-the-line charts that come with StocksToTrade. Grab a 14-day trial for just $7 now!
Keep Track of Stocks Using Watchlists
In the U.S. alone, the stock market is HUGE, more than 18,000 stocks traded every day. That’s way too many for any one trader to track.
At any given time, only a handful of stocks show premium setups and opportunity. Smart traders know it’s crucial to stay current. That’s why I recommend that you build and keep watchlists. It’s a key way to help you keep an eye on certain stocks and sectors.
A watchlist is simply a list of stocks that you watch because you believe they show potential. An individual watchlist can be made up of stocks in a certain sector, your favorite stocks to trade, or anything else. The choice is yours.
You can keep your watchlists by hand and constantly look up the tickers … but that can be a huge hassle. StocksToTrade comes with amazing watchlist capabilities to help you save time and effort. Check it out with a 14-day trial for just $7 today!
Take Advantage of StocksToTrade Features
Stock scanning can be a powerful and useful step in your trading journey, but it’s just one step…
You also need to think about charts, news catalysts, and much more. That’s why we recommend you take advantage of StocksToTrade’s features.
Our goal when designing StocksToTrade was to build a one-stop shop for traders. It’s a solid platform that many of the best traders in the world use every day.
Here are just a few of the powerful features available on the StocksToTrade platform:
- Lightning-fast connections to all the U.S. exchanges to help you stay current on the markets.
- Access to our backtested strategy scans to help you quickly locate your next trade.
- Elegant charting features.
- Unlimited watchlist options.
- Powerful news scanning to help you quickly find hot news stories, SEC filings, and social media buzz that can affect stock prices.
- Fundamental stock information at your fingertips to help you learn more about a company fast.
- Streamlined paper trading facilities to help you test strategies and develop real-time trading skills.
I could go on and on about all great features on this platform. But here’s a better idea: check it out for yourself. Get a 14-day trial for just $7 now!
Conclusion
Using a stock scanner to find trading opportunities is something smart traders do.
It’s a powerful tool that can help you with the heavy lifting so you can find stocks that fit your strategies. Using a scanner well can help you free up more time to focus on research and your overall trading plan.
Running scans can be simple, but you need to know what to scan for and what to do with your scan results. Keep this post handy in case you hit a snag.
And know what you’re getting into — some scanning software requires programming knowledge just to run scans. Don’t know how to program? That’s OK. There’s a simple solution…
With StocksToTrade, you can run all kinds of scans, from simple to complicated. All with just a few clicks of your mouse — absolutely no programming skills required! Get your 14-day StocksToTrade trial for just $7 today. See just how quick and easy scanning can be!
How does scanning fit into your trading process? What do you look for in your scans — and is more or less better? I’d love to hear your thoughts … leave a comment!
