This post was contributed by a guest author, and does not necessarily reflect the views of Richard or MovetheMarkets.com
Here’s the results of the NR7 Scan for today:
From now on, instead of spamming MTM proper with my scan candidates, I’ll post them on a dedicated page daily. You can find the link to them on my author profile.
This entry was posted
on Thursday, May 10th, 2007 at 5:37 am and is filed under Trading.
You can follow any responses to this entry through the RSS 2.0 feed.
You can leave a response, or trackback from your own site.
..are you familiar w/ matt claassen?
Inside-day Volatility Set-up
Put simply, I look for a stock where the range (high-low) is the lowest value of the last 7 days and the stock is an inside day. Also, the stock needs to be trending, in this case the ADX value is above 20. What makes this set-up different from a simple inside day is the volatility component. By identifying a stock that has the lowest daily price range (high / low) experienced over the past seven days we are finding stocks that are in a stage of low volatility and are using the inside day parameters to identify when the stock has moved to a stage of high volatility and its direction.
Volatility in the stock market has been the subject of many university studies. Time and again it?s proven that volatility in the market is cyclical; periods of high volatility are followed by periods of low volatility followed by high volatility and so on. Many investors chase volatility. When we buy a breakout or sell a breakdown we are identifying stocks that have entered a stage of high volatility and hope to enter the stock at an early enough point in the high volatility stage to profit from the move. [View my instructional video on volatility.]
The Inside-day Volatility Set-up is designed to identify short term (three to five days) cycles in volatility and allows us to enter the position at the earliest point in that cycle as is reasonably possible. Often, when this set up is identified at important points of support or resistance the short term trade turns into a profitable intermediate term trade.
StockFetcher syntax:
/* NR7 ID */
Show stocks where day point range reached a new 7 day low
and high is below high 1 day ago
and low is above low 1 day ago
and ADX(14) is above 20
and close is above $3.00
and average volume(30) is above 50,000 shares
Tom,
Thanks for that. No, I don’t know about Matt Claassen–I’ll read up on him. How would you trade these inside NR7’s? Buy the breakout, stop below the NR7?
BTW, this returns 98 results for today. How do you cull them down from here?
If you take my NR7 filter and add the requirement that the NR7 be an inside day, then today you get four: TFSM, MEMY, BRLC, and JSDA…