A market scanner is a vital component to any day trading strategy. Successful day trading comes from trading the most volatile stocks in the market. Since day traders have only a few hours per day to trade, it is best to focus on a limited number of stocks. Thus, market scanners provide the day trader the easel for which to paint their masterpiece.
Market scanners search the issues on the exchanges and return results based on user inputs. Every trading platform comes with basic market scanners that display the greatest percentage change and high volume stocks for the day. The ability to scan the market for specific criteria allows the day trader to focus on trading their specific edge and not manually scanning for issues.
Below are a list of criteria that day traders use to scan the market on a daily basis:
Percentage Gainers/ Losers – these are the list of stocks on the major exchanges which have the greatest change in price.
High Volume – stocks with the highest trading activity for the day
Chart Patterns – scans the market for specific chart patterns (double tops, triple bottoms, moving average crossovers, etc.)
Breakouts – stocks breaking their daily highs or lows