Looking for how to find stocks to swing trade? Having a solid scanner will be your best friend. You could use an HOD volume scanner, breaking news, stock sectors, and unusual options activity as some of your filter settings. Scanners help you to find the plays that are running that other traders are watching.
Swing trading has you holding stocks overnight for up to a few weeks. You want and need maximum profits on stocks that have good movement. You can use several tools to scan for swing trade stocks.
Introduction on How to Find Stocks to Swing Trade
When you’re learning how to find stocks to swing trade, there are some things you should consider. How long do you want to hold a stock? Swing trading usually lasts 2-6 days but can last up to 2 weeks. You can also go long-term and hold a stock for much longer. You can pick swing trading techniques that work for you. If there are certain criteria you’re looking for, using something like the Barchart stock signals screener is a good tool to have. It allows you to look for specific trading signals; hence, you can set up a screener that fits your style.
If you’re more long-term, you can set it up to look for plays that will happen over time. Set your screener to find that if you want to hold just overnight.
A tool like the Barchart signal screener can set you up to succeed in swing trading.
Scanners
When you’re learning how to find swing trading stocks, find a good scanner. You can have those few stocks you trade repeatedly, but it’s good to have alternatives.
What happens if you only trade certain stocks in a sector and they’re trading sideways? You’re not going to find any good plays. You don’t have to worry about finding good plays if you have a good scanner.
ThinkorSwim has scanners you can set up for swing trading. Set up the scanner to the criteria you’re looking for. You can scan each night to find plays for your watchlist.
The Trade Ideas scanner is another one that you can use. Trade Ideas can save you time if you’re looking for something quick. You can set your scanner to look for the kinds of plays you like best.
While you can use Trade Ideas for swing trading, there’s an even better scanner. It’s called Market Club. Market Club’s system uses different signals to help confirm success.
They’re big into triangles. Those are pretty profitable if you know anything about patterns and triangles. Their green triangles give you a strong signal of a daily, weekly, or monthly trend. While their red triangles can be used if you’re into trading put options or shorting.
What Are the Best Swing Trade Stocks?
Swing trading allows you to bypass the PDT (pattern day trader) rule if your account is smaller than $25,000. As a swing trader, you need to know how to pick stocks to trade.
The best swing trade stock you can find needs to be able to make good moves in a shorter period.
The best swing trade stocks make nice moves quickly. You’re not getting in and out on the same day, so you want something that will move at least overnight. You want to remember to avoid getting caught up in the hype.
Yes, there’s excitement with stocks with nice moves, but don’t jump in when you hear a stock being hyped up. That’s a good way to lose money. Instead, focus on price action. Price action is a stock’s movement in price coupled with technical analysis. When you find a stock that makes significant moves on a multi-4day time frame without hype, you’re not relying on others to pump it up.
Large-cap stocks such as Amazon, Nvidia, and Tesla make large moves daily. They can also get expensive. Finding stocks that are $20-$50 is good.
You want a little variety when looking for the best swing trade stock. They say variety is the spice of life. The same can be said for swing trading.
How Long Should a Swing Trader Hold a Stock?
How long should a swing trader hold a stock? Typically, between a few days and a few weeks. There are several ways that you can swing trade. You can trade shares of a stock or use targeted options strategies such as credit spreads, debit spreads, iron condors, and calendar spreads.
Technical Analysis
You need to know technical analysis when looking for stocks to swing trade. Knowing support and resistance is extremely important! These are levels that trade pays particular attention to, especially knowing how to find stocks to swing trade.
You can find support and resistance through candlesticks and moving average lines. Candlesticks also tell a story. You can use candlesticks for buy and sell signals along with moving average lines.
MACD and RSI can also help you determine what direction the stock is headed. It’s important to be able to draw trend lines. Learning how shorting works is a great way to profit when the market is heading down.
Trend lines map out a stock’s direction and draw triangle patterns or pennant patterns, such as bull pennants and bear pennants.
Stock Picking Services Are Not Equal
It should be no surprise that you must be selective with whom you take trading advice. You wouldn’t take advice on stock picks from your barber (unless he has a proven track record), and you shouldn’t take recommendations from an unreliable online company.
So before choosing a swing trade picking service, here are a few things to consider:
- How long has the company been around?
- Who runs the company?
- How transparent is the company?
- Are you able to see how they come up with their picks?
- Do they show you how to trade the picks? Do not follow the herd; be smart and analyze the movements and the connection between the picks and the market.
Please be aware of the subscription details. Will your subscription auto-renew if you don’t cancel early enough (three months with my special promotions links at the top, normally twelve months)?
I recommend avoiding subscribing to too many services at once. Go with one subscription and make the most of it.
Free Swing Trading Picks
I’m not here to bash any company providing free information, but I want to caution you. Don’t believe everything you read. A lot of these free services are free for a reason. Free swing trading services are generally not as high quality as paid ones – sometimes, you get what you pay for.
For one thing, they don’t provide valuable information or tell you how to trade the position. Not to mention when to enter and exit or why you should take the trade in the first place.
In my experience, the word “free” is the carrot dangled to get you to sign up for their other more “exclusive” services.
However, they can still help you screen through the noisy markets to choose the right stocks. But please do not make the mistake of just buying or selling because you received an email.
Paid Swing Trade Picks
Unsurprisingly, the expensive, paid swing trading stock picks are easy to find online. Some immediately come to mind are Jason Bond Picks, Jim Cramer’s Action Alerts Plus from The Street, and Dow Theory. All have trading professionals behind them with years of investing experience in their back pockets.
What I like about the paid services is that you get, at a minimum, information on how to trade them. For these reasons, I suggest signing up and monitoring what they provide.
Do you know if their services are aligned with your stock screening process, or what do you need? This way, you can see the quality of the daily stock picks to see if they are valuable and match your trading style.
Since I swing trade, I will likely be disappointed if I get swing trading stock picks from a day trading service. You have to apply this same logic to daily stock picks.
Final Thoughts on How to Find Stocks to Swing Trade
Patterns are really important when you’re looking for swing trading plays. Traders are creatures of habit, and they look for patterns.
You have the overall large patterns, but smaller patterns are inside those big patterns. You can trade those smaller patterns while waiting for the big pattern to break out.
Remember that patterns break down all the time. Look at what the candlesticks are telling you. If a pattern is at a breakout point but doji candlesticks are forming, wait for confirmation of direction.
As you learn to find stocks to swing trade, practice using scanners and trading in a simulated account. Practicing allows you to work out the kinks and fix any problems and mistakes you see.
