Using Relative Weakness To Find Trades
- Posted by TheArmoTrader
- on January 18th, 2012
One of my favorite go to day-trading strategies is finding relative weakness in the first hour. Usually when the market is showing strength, and a specific stock is trending down, expect it to trend down for the rest of the open, if not day. I keep a piece of paper next to my keyboard and as I find relative weak stocks in the first hour, I write them down. I have two ways of finding relative weak stocks.
- Using my Trade-Ideas Scanner, I have 3 scans that I pay attention to. The first is called “Explosive Down” moves (scans for stocks moving down hard/fast on volume), the second is just a “low” ticker, and the third is a “weak” scan (scans for stocks just trading down).
- Finviz: I run a simple scan showing liquid stocks that are down 1% from the open. I sort them by Relative volume in order to get the ones doing the most volume on the top (these usually have a better chance of trending down).
(all 5 min charts)
$APOL - Apollo Group Inc.
$PM - Philip Morris International, Inc.
$DTV - DIRECTV
The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.blog comments powered by Disqus
Jerry Khachoyan is currently an undergraduate student at UCLA pursuing a degree in Political Science. He started trading in September of 2008. He concentrates on using technical analysis and reading the tape to enter the best risk/reward trades. The stock market to him is one of the greatest inventions by man.
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