Finding stocks to buy that meet a specific stock trading strategy is an important step in becoming a successful online stock trader. It is important to be able to find and trade these stock ideas for yourself. It’s like fishing, it’s one thing to know how to fish, but if you can’t find the fish, you won’t be very successful. You can either look out for financial consultant like Motley Fool or you can use tools to find out one. There are many different tools for finding trade setups available online. Some are free, and others require a paid subscription but either can prove invaluable.
First you need to have a stock trading strategy clearly written out complete with a detailed description of the set-up and rules of the trade and if you need one, Motley Fool Stock Advisor Review will be of your help. If you don’t have a strategy, it will be tough to find high probability stocks to trade. Start off with a description of what you are looking for in a stock to buy. This could include historical data, relationship of price to support, resistance, or technical indicators such as moving averages. Be as descriptive as possible. Once you have these written down, think of rules that you can apply to the setup. This might include minimum stock price, maximum stock price, minimum volume, and so on.
After you have your stock trading strategy written down, you can now begin to find a scanner to help you look for these stocks to buy that best match your setup. The type of scanner you need is dependent on the type of stock trading you are going to be doing. Day-traders will need a scanner with live real-time quotes whereas the swing trader or long-term investor can use end of day stock quotes.
When looking for a scanner, pay close attention to the filters they use for scanning. You want to make sure it has filters that will allow you to narrow down stocks to your specific strategy as close as possible. For example, if your strategy involves volume, you wouldn’t want a scanner that does not allow you to filter our stocks that don’t meet a minimum volume requirement. Seek advice online from other traders that have had experience with different scanners and can give you reviews of some they have tried.
Most of the online stock trading software packages that are available through online brokers have a screener or watchlist available. These will allow you to keep track of stocks that are on your list of possible setups. If a swing trader is scanning for stocks at night through an end of day service, it would be beneficial to load all of the possible stock trading ideas into a watchlist to view during stock trading hours. This will keep you more organized and stay better focused.
Once you have found the right scanner, or better yet a couple different scanner, continue to tweak the settings until you come up with the best settings to match your requirements for stocks to buy. Remember the market changes frequently so it will probably be necessary to consistently tweak your settings in order to keep up with the best ideas. Once you have “learned to fish” you will become a more successful online stock trader.