Time To Tune Up
Sometimes we
forget to look at bigger pictures of the market, as we concentrate so
much on picking individual stocks for trading. As you know, your chances of
winning are greater if you buy stocks from the strongest sectors. Needless to
say, your odds will also be improved if you short stocks from weak sectors of
the market.
The performance of Exchange traded funds (ETFs) can provide us with
excellent information on both weak and strong sectors of the market. You can
find this valuable information in TradingMarket’s.com Funds
Indicators section.Â
As of the close of June 22, the top
ETF in the past month is Biotech Holdings (BBH), and its daily chart is
shown below.
The next step is to look for buy candidates from the biotechnology sector. (Of
course, you can trade Biotech Holdings above.) One easy way of looking for
stocks is by using TradingMarkets.com Stock
Scanner.
Just follow these simple steps:
  1. Choose Biotechnology for the Sub Sector
  2. Insert closing price ranges of your choice
  3. Put in desired 50-day average volume
  4. Insert 3-month RS numbers
  5. Go to the Closing Price Comparison To
Moving Averages section and choose.
That’s it. As I said, it’s easy. The example below is the result of scanning for
stocks with a closing price of 25 or higher; 50-day average volume of 300,000
shares or higher; 3-month RS of 95 or higher; and a closing price above
both 20- and 50-day moving averages.