Scanning for Setups

I’ve been asked a few times HOW I find the chart setups I play, so here is my routine the night before each trading day.

I use the scanner on FINVIZ.com. This is a great free website that many traders here on Twitter use. I use the following parameters for my scans:

- Market Cap: over $300 million
- Average Volume: over 300k
- Price: under $30
- Over the 50 day ma (for long setups only, I remove this for short setups)

This will usually give me about 50 pages of charts, which translates into about 1,000 charts. Yes I scan 1,000 charts almost every night. Overkill? Probably…but there’s no scan that can replace the human eye, and it’s important to find the best setups to invest your hard-earned capital!

This scan will generate a bunch of garbage stocks. It just my personal style to not trade anything over 30 bucks. Small-mid caps bring the volatility to create huge gains (and losses).

When I find a chart I like in the scan, I’ll verify it checks out on the 2 year chart as well (don’t want any major resistance that I might have missed on the 9- month chart that FINVIZ.com uses). At this point, I set an alert on my trading software and I’m ready to go for the morning.

Hope this helps!

Brian