Wednesday, February 24, 2010

Stock Scanner Setting to Catch the Trend-line Break


The Trade-Ideas stock scanner can not only show you events that are happening now that have implications for short term day trading, it is also used to find trading patterns for longer term investing or swing trading.

One of the most powerful trading set ups is a trend-line break either up or down. What we will demonstrate now is how simple it is to create a monthly trend-line breakout system using alerts and filters that are inside the Trade-Ideas stock scanner.

Let's start with the filters. We are looking for stocks that have been trending lower as of late. In order to find that stock pattern we will use our position in 20 day range filter. We will set the maximum value to 15%. That means that stock has to be trading in the lower 15% of its trading range over the last 20 days. To avoid stocks that don't move we added a volatility filter set to have the stock trade at least a range of 1 dollar over the last 20 trading days. If you ever want to know how to set min and max values in our filters and what those values mean, click here to access a tool that we created which specifically explains everything in detail.

Now let's set the trigger to get us to see when the negative trend is broken. The easiest way to do this is to select a 5 day high as the trigger and to make sure that the high is above the high of yesterday.

In the attached picture above you can see the last stock that came across SNMX, take a look at the daily chart for yourself. Finally to make sure this strategy is viable we ran the odds using our OddsMaker. We said we were going to be buying these stocks and holding them for 3 days. Sure enough the results are pretty impressive, with a win rate for this strategy at over 66%.

Being a successful trader means finding what is working more quickly than your competition. This whole exercise took less than 10 minutes to build and test the strategy. We are certain that no set of tools on the market today can get you better and more timely results. That is the power of using the Trade-Ideas stock scanner and our back testing tool called the OddsMaker.

Click 'Buying the Trendline Breakout' for the exact set up.

March 2012 Update:
The Trendline Breakout link above now points to the right strategy.
I ran OddsMaker to test the following trade plan:  Look for trades from 30 minutes after open to 4 hours before the close (only morning session).  Hold for 4 days until open.  Stop loss of $0.35 + wiggle.



Note the nice ratio of average winner:average loser.


Monday, February 22, 2010

What can a Stock Scanner do for you?

There is lots of stuff going on behind the scenes at Trade-Ideas. As we work to bring the latest innovations in trading and investing to market we really want to hear from our users. Here is the bottom line. We have lots of alerts and filters to choose from. Basically, when you configure the Trade Ideas stock scanner, you can slice the market up in almost any way that you can imagine. That said, we know there are great ideas out there and we would love to incorporate them if possible. Here is a small example of some features that are coming soon to a Trade-Ideas stock scanner near you.

1) MACD's on multiple time frames
2) Stochastics on multiple time frames
3) RSI on more time frames
4) Top lists

All of the above is already in the works and being tested. Tell us what you want. Post a comment on the blog or send an email to dan@trade-ideas.com

We are serious about getting more of our customers involved in contributing to the feature set!

Sunday, February 21, 2010

Investing Smart: Don't Trade Away Your Freedom to Profit

Investing and trading are not really all that different. The question is of course the time frame. Day trading has often been portrayed in a negative fashion but in reality the mechanics of investing and day trading are the same. It is all about the time frame, but even that is a bit misleading, the truth is that it is more about control.

When one says, "I am in it for the long term", it is simply a phrase that says I am letting go of risk controls. That may sound harsh but it is true. If an investment starts to perform poorly, how long is the long term? When Ford Motor Company went from $40 per share to $1 at what point do the long term investors say enough? This is at the heart of failure in stock trading as well as investing in the markets. When you give up control, you set yourself up for failure. The big brokerages want this believe it or not. They want you to give them your money and they would prefer if you completely let them control it from start to finish.
Pricing Conditions Behavior

Ever wonder how brokers like Schwab and Fidelity still charge $8.99 per trade and try to sell it as cheap? Think about it. You just bought 100 shares of a $10 dollar stock. You just paid 9 cents a share!!! If you had to repeat the process 10 times during the day, you will have paid the brokerage $90 dollars that day. This pricing basically says, please don't trade often. When it is price prohibitive to trade often people feel like they have an excuse for why they give up the control. Do not let yourself fall into this trap. There are less expensive alternatives that are just as safe, that will give you the kind of pricing that at least makes it possible to get out of danger. Imagine a car that only turned right!

Does that mean you have to trade stocks often? Not necessarily, you just need to have the ability to do so without punishment. We are fortunate today because many market alerts and filters things that are important to long term investors, like P/E ratios, sales, and debt can be incorporated into stock scanning software where the results automatically make sure you are only looking at candidates that meet the minimum level of performance in a long term investing or trading strategy.

The Trade Ideas stock scanner incorporates fundamental data in its stock scanner results. One approach to using building useful scans consists of finding stocks are not only performing well from a technical analysis and price action point of view but exhibit: A) strong or B) weak fundamentals depending on which way you are looking to trade the stock. See all the fundamental indicators that are available in the Trade Ideas stock scanner.

When looking at strength or weakness don't settle for being one dimensional. Take advantage of all that the Trade Ideas stock scanner has to offer, including a wide breadth of fundamental data to help you zero in on winning trades!

Thursday, February 18, 2010

iPhone Stock Screener, version 2, is now available in the app store

Be sure to check out the recent upgrades to our iPhone app!

What's new in version 2

  • We've added more icons for clarity.
  • You can now log in to your Trade-Ideas account from your iPhone. This is not required, but it will allow you to access some additional features.
  • Your scans can now include custom symbol lists. You can now scan for only certain symbols, or exclude certain symbols.
  • You can now sync your stock scans between your iPhone and your computer. You can create a market scan on either one, and then use it on the other.

Free Realtime Market Data on the iPhone

We've gotten one request more than any other. People want to get realtime market data rather than delayed data. And they want it for free.

That's a little tricky for a number of reasons. There are exchange fees, of course. But we're working on it. We plan to set it up where you can use the data from your Trade-Ideas account or your brokerage account on your iPhone. You're already paying for that, so why not use it everywhere you go?

Do you like our iPhone app?

We've got a lot of active users, but only a handful of reviews in the iTunes store. This is a free product. We're doing it all for the publicity. If you like our iPhone app, and you want us to continue working on it, please give us a good review. Thanks!

Download our Free iPhone app

Click here to get more information about our app, including download instructions. iPhone Stock Screener Help

Thursday, February 11, 2010

Stock Scanner, Stock Screener, Stock Filters: Know the difference


We find that many people today are confused about the difference between common industry terms that describe software that helps to identify trading opportunities. This blog post is to help clear up this problem. Let's start at the top.

Stock Scanner - A stock scanner, like the Trade-Ideas real time stock scanner is software that watches the market in real-time and then displays events in a streaming format. That means you do not have to manually do anything to get new information. As new stock alerts occur they are streamed directly to your desktop.

Stock Screener - A stock screener, like the one found in the Trade-Ideas trader's area section gives the end user a list of filters like price, volume, and many other criteria by which to limit the search. Once the user inputs all of the appropriate stock filters, the software goes to the database and retrieves a static list of all of the stocks that met the criteria. The most important thing to note is that stock screeners are static, that means they do not update unless you refresh the page or manually adjust the filter criteria.

Stock Filters - Stock filters, like the ones found in the Trade-Ideas help section are used to limit the criteria by which to search for opportunities. Examples of stock filters include, price, volume, EPS, beta, or even a customized symbol list. Stock filters are very helpful in refining scans or screens in order to not be inundated with tons of information.

We hope this helps to clear up what you are actually looking for when evaluating trade detection software.