Scanning for stocks & Multiple Time Frames - Beginners lesson 7 of 8Jun 06, 2021
Hi guys, it's a camp for underground investors. Welcome to
lesson7 of 8 of our trading guide for
beginners. If you're watching this video and you haven't seen the previous 6
lessons, you can click on this green button which will take you back to The first one is really where you should start. We have been receiving a lot of information. I am very proud of everything we publish for everyone. If you are not subscribed to the YouTube channel, you can do so here and click. This subscribe button just means that you'll get alerts when I post new videos and you won't miss anything, so I've got a lot of stuff to cover in this lesson.
Nate and I are co-hosting together, let's get started and talk about what
scanningis. Trading is all about matching, if you just turn on your computer and try to trade every stock you see you will end up having information overload or ticker overload. The key is to really take all those thousands of configurations that may be available on any given day, but break them down into just a handful at most. You know what the best trade is most favorable to you and you know that different traders will do it. I have different types of scans and different types of results, but whatever gives you the best opportunity for the type of trader you are, there are countless different ways to scan, you can do it every night, you can do it in the middle of the day and even There are many real-
timetype scanners that continually produce results for you, but it really comes down to what type of trader you become: do you want that information at your fingertips every second or would you rather focus on the big thing?
Imagine something that maybe lasts a couple of days or a couple of weeks. What
scanningallows you to do is basically be prepared so that when certain actions occur, you can just react and give you the conviction or confidence that you need in trading. Able to go ahead and pull the trigger when you had planned to do so, scanning allows you to find a handful of names that are of interest but, more importantly, allows you to take a first look and develop a plan in advance. That way, as soon as you see it, you can react.
It's one thing to simply look for movers or force a quick trade when you see one, but really preparing is what highlights those positive setups that will give you A+ style profits. After all, less is more and the more prepared you are, the less you will need to trade, it is just a matter of fine-tuning your scans to select the trades that will give you the best results, why is it important to prepare? that extra push that says you know, hey, you've seen this before, there's a very good chance you're right, so just do it and you'll know that just in case you're wrong, it was worth the risk. potential reward that was there when you do the task, it gives you the confidence to go ahead and just take that trade you see, there are many
stocksthat can appear on the scan that you can see during the day and you know a lot of new traders will have a case of FOMO or fear of missing out and you see it every day, they just want to get into a trade, but once you're in and you don't really have a plan, you don't really know where to stop and half the trading battle is probably more Half the battle is being able to cut your losses and if you're jumping in headfirst without really a plan to stop or an idea of where I'm wrong, then you're going to have an uphill battle.
It's actually better to wish you were in a trade than to wish you weren't in one of the most important things about scanning: it gives you the opportunity to see the chart. at least once before you jump in so that in the back of your mind you have a general idea of what that chart looks like before it appears in the name, so it's about having familiar patterns and setups that you're with familiar and there are so many different reasons to take a layup, so you need to analyze what you are trying to do in each and every type of operation.
What type of configuration are you seeing? Is it a quick operation that was analyzed last night? an overextended chart and it should have a quick correction right off the bat if that's the case and it's probably a fast date rate or it's a beautiful daily chart that is setting up for a
timeframe breakout for those who don't know what
multipletime frame breakdowns, don't worry, we'll get into that, but if it's something you might be looking at in a broader idea, it might be good for a separate account and last but not least, you know if We're actually looking at an even broader idea that may not even be a daily or a couple of days trade, but something that you feel like is a week or two weeks or maybe even a month, and that could be something well if you make it. your own 401k, something that you know you might want to hold onto for a couple of months, maybe there's some news that's due in three or six months and you think it's going to pile up so much that you don't want that stock in your day trading account because You'll be watching every day and as soon as it starts showing up you're probably inclined to go ahead and take the profits and cash them out, and the goal from the beginning is just to command to hold it, so that's what I normally do.
I usually have different accounts for different strategies. You really need to ask yourself these types of questions before jumping into a trade to give you an example whenever I'm thinking about just a day trade. on a name I would normally trade it on Wedbush or et Cie on my Centerpoint accounts and 99% of the time I am in cash overnight, there are occasional times when I can hold a short or long position if I have a good average on that account, but most of the time, if I'm thinking about a potential gap or something that I might want to hold overnight or maybe a little bit longer than a typical day trade, it would take most of the time, I put them in II trades, where you know it is on a monitor separate from the main one.
I'm not watching every tick because you know you're going to find that a lot of times when you watch it and it starts to appear and it's doing exactly what you want. I thought you might start hitting the cell button because you know you're used to locking in profits, so to keep going and let the trades run beyond the initial pop, I usually put them in a tray and then last but not Less importantly, if it is I think a possible breakout is going to take a couple of weeks to move. I'm going to put it in the 401k and have it on the rightmost monitor where I'm not watching every tick.
I just put it there, manage it, but I kind of forget about it in a day to day period of time, whatever the case may be, every account has a reason and every time I have a day trade that's in one of my accounts centrals, if he starts thinking about you know, maybe maybe he swings that good, that's not the reason I started trading because it's in my day trading account, so a lot of times what I'll do is think yes I want to hold on to it and if I do I will go ahead and just buy it or short sell it in my etrade account and then cash out my Centerpoint account which really helps me because on a day to day basis I can always just focus and not have anything that it is during the weekend, anything that is during the night and that can be up or down, it somehow affects me, it is like logically looking at it all day and saying ah, you know what I started too big in the hole and it's separated and I can continue to focus on the trades at hand on that given day Hey guys, you're back again, so one thing I've noticed Nate doing while using these three separate types of segmented accounts for different strategies is that the longer you plan to hold them The smaller the size you will use in that trade, so, for example, if you want to trade a thousand shares of something intraday, there is no problem because you stopped sadly and you know your risk and everything is defined, whereas if you wanted to change something of the same ticker, then it could be two to three hundred
stocksbecause your risk is a little less defined and you'll hold it for a lot longer and then in the 401k it could be 100 stocks or something like that and this is basically two variants of juice and mitigating some of the unknown risk associated with holding stocks for a longer period of time.
The next section is what makes a chart interesting, what type of charts we are interested in and what is the importance of lining up across multiple time periods, so a main topic that I talked about a lot in our educational videos is what creates the largest audience on a name, referring to when the most people will see it, when it will be most liquid, when it will have the most volume and the short answer is when there are different types of traders watching it and maybe even investors, maybe there is an aspect fundamental where a PR occurs, but from a technical point of view, it could be a great daily chart that is preparing for a major breakout, but on that same day.
It looks like it's starting to prepare for an a/b c/d breakout and combined with a possible whole number breakout it may be a 52 week max and all of these things together create a bigger and bigger audience and that's where I like it. What to focus on because that's where all the emotions are going to come together, all the fundamental type traders, all the technical traders, and it's going to be a much bigger move versus something that's just trading a few thousand shares here and there and and Nobody. really cares, so it's always important, at least for the type of trading that I do, to look for liquidity, look for stocks that trade a lot of volume on their own and all of those can be found by doing scans the night before for charts that are they are approaching a breakout or a breakout and then they come to the market prepared so that when you see them intraday on different intraday scans you can react much faster.
The setups we like the most, at least for me, are a multi-time frame breakout type. and momentum personally, I love seeing a daily chart set up the same way I like seeing an intraday chart, so those of you who have been watching this series and whatnot are probably familiar with an ABCD type of move for the most part. weather. The time I covered it talking about intraday, I see an intraday looking at it on the 1 minute chart, but when you see it on the daily chart, where it might have had to move last month, it started to pull back, start to consolidate, go back to those maximums. that with the type of intraday movement that we cover regularly, then you will have a multiple time frame, two different time
framescoming together towards a breakout will have a much larger audience, another on the short side is the overextended names that we now scan the night above will provide you with a great list of potential trades so you know that typically if you wanted to short a parabolic style move on an overextended chart type you would typically be looking at a stock that broke out. some kind of consolidation and it continues to go up higher and higher and higher and higher and it still has to correct now, it doesn't mean it can't continue to go up, but usually at some point it starts to accelerate until the bullish side starts to move and it's some kind of movement Parabolic, which is a move that is faster relative to how it's been trading before, there's usually a pullback of some sort and that's what we're looking to take advantage of, so if you're doing scans the night before and then you hit the market in the morning and they are opening to continue breaking, those are your main watches, another is the setups that are breaking out or breaking out due to some type of consolidation, now the reason What we care about is typically when a stock stagnates for a time period, what could be considered a channel, could be considered consolidation, could be stuck in some type of range, let's call it 50 cents, well, when you break out of that 50 cent range, there is a good chance that any candle you make, whether it's up or down, it's probably going to be bigger than that, it's going to be bigger than the 50 cent range and that's why we focus on when the stock starts. to the trend that starts to break out because what we care about is the momentum in the range and the range is where you make your money if you want to trade a stock with a range of three or five cents on the day, by all means do it, but I know that's not what we focus on, many times these setups are preceded by increasing volume that slowly builds up to a higher volume day and that is typically the day I look to trade it, so now that you know what kind of breaks and scan results. we search exactly how we found them so fin biz is a great website that I use and the best part is free, there are a lot of annoying ads but at least you can still know what you want to do if you don't want to pay for it, without However, if you pay to not have the ads, get real-time quotes, can run them all day long, and don't have a 15-minute delay, it's a perfect overnight scanner.I would consider fin vis as a technical tool that I use, there's a lot of fundamental type stuff in there, you can get a lot of information as far as flow, pending stocks, news updates, all that kind of stuff, so their elite version is good, but it is not a If you need to scan at night, you can use it during the day and if you are going to do that, I suggest you go ahead and pay for it, but if not, it is only a 15 minute delay, but it will produce great results.
One thing I like is that you can see all the charts right there and you can do that, and you know 10 charts per page or all of them. on one page and it allows you to jump in very quickly and see if there's anything that interests you, so let's take a quick look at the fin vis platform on the home page. You have a lot of very useful information in my opinion and this is really good for reviewing things during the day. I like to scroll through this area here and take a look at things that have abnormal volume and range and the fact that it's on this list is self-perpetuating in that sense. a lot of other people will look at it and look for intraday setups to be able to trade, that's what creates the momentum, there are stocks outperforming on this side, everything is great, so now we're going to go into the screener and we have some presets saved here , we'll take a look at the green scan and I just wanted to show you the parameters that we use to start filtering out the charts that we think are going to be interesting, so what? clean does it daily, he reviews, you know all these charts and he takes a look and there are pages of these charts that you know, but he will review them as he creates his scan for the investors, underground members and from these 100 to 150 charts, we will narrow them down to eight to twelve in total that he thinks are interesting and could have the potential to offer a positively oriented reward-risk ratio if they start setting up intraday, so let's take a look at another of the presets.
That Nate uses what he calls dump scanning, so these are basically the parameters up here and when you scroll through them, the stock takes kind of a beating that might be waiting for a little bounce and as you can see, there are three pages. Every once in a while, what Nate will do is create a scan every night that he'll post, you know, around 6 or 7 p.m. Eastern Time and you're going to recap the day you just finished trading and you're going to go over the things that you're looking at for the next trading day that you think present the best opportunities and you have a plan for each of them and these are the stocks that you I kind of put it on my charts in the morning to make sure I'm looking at the right kind of things that are in play and I often had traders asking me, hey, camera, how do you know what stocks you should trade? and really the answer lies in this. list that has been painstakingly put together for all of our members every night.
Wow, we're really getting over a lot in this lesson. If you've enjoyed what you've seen so far, please give me a thumbs up, it really helps my videos. and it also helps encourage me to create more free content for you on the YouTube channel again. If you have any questions, you can send me an email. It's Cam and Investors Underground com or if you just want to chat about your trading. or you want to join the underground community of investors and I would like to understand the best way to do it. I can help. I answer all emails personally.
Send me a note and we'll get in touch. It appears below. talk about new scanners and some of the things to keep in mind when exchanging news, so there are a lot of new scanners and some are more useful than others. You know that you have different terminals. I have different plugins for brokers that have some kind of source where you can get news from and it can be really helpful to get breaking news especially on stocks that you might be trading and also maybe understand a little bit of what's coming up in terms of of key. catalysts for things that you might be trading or might want to trade, but the news is not always black and white, sometimes some news that could be read very positively will come, but it won't be as good as people's expectations and the stock will go down. sometimes. everyone was waiting for the news and took a position before and when the news comes and you want to buy you might be a little late to the party and people might be exiting their position for you to enter your position and lastly often with stocks that have a catalyst.
Next, a lot of the news can be priced, so what you might see is a very positive press release that may have already been factored into the stock price because they hinted at it a couple of weeks earlier or something. scanners personally, I don't subscribe to many new services, a lot of the services I have have their news features, you can make filters for stocks that are on your radar, so if something comes up you'll get an alert about things like that, but most of the news I poll, see or react to comes from the chat room, we have people in the community who are very good at identifying what news matters and that's all I use and that's what they're good at. en and that's what they bring to the table.
I'm good at technical type of trading and that's what I bring to the table, so that's really one of the best parts of the chat room: there are a lot of different types of people there, esp. For example, in biotech, someone may be great at news, but have no idea about upcoming FDA decisions or what a certain approval means for a stock, whether or not there's a chance of a rebound, and whether something is an overreaction or not, so I have a lot of guys who are really good at biotech, so to me it's better than any new scanner and I'm trying to figure out, you know, certain words, there are also live scans and most of our technicals are at least based on In my opinion you have the hiya day list, you have stock feed and as I said before you have the chat room so hide and load a list I get: Trader and many other platforms have it now. but it's actually just a scanner that shows the stocks that are hitting every day high and the stocks that are hitting every day load and I know it sounds simple but remember you're scanning at night and you're seeing all these tickers that are in scanning. and you're narrowing it down from thousands, maybe 50 or 40 results down to a handful of your favorite names, well sometimes you're not really seeing it, then you see it in the featured days list and it immediately comes back on your radar, that's how I use the good days list just to see where the momentum is or where the selling pressure is and if it's a typically slow day you might know to look at that to try to find some sort of potential capital movement information is a great intraday scanner, it's fully customizable to really give you literally what you want displayed and over the last year, maybe even two years, most of what I've been trading really just comes off the top. percentage list on the top earners list, you know the top movers as long as they have a lot of volume, but basically it scans at night and then just the top earners, top movers by percentage , you narrow them down and get a couple of names that you're familiar with and it becomes my primary watch and honestly, I don't subscribe to many scanners anymore.
I don't run as many scanners anymore. If you have too many things on your plate, you will try to do two things. You're going to try to see everything and end up missing the trade or you're going to try to trade everything you see and ruin everyone so Nate I'm going to say probably the best life scanner out there is a high quality chat room and really the The highest quality are the underground investors and I'm not biased at all but it depends on what you're looking for if you're looking for a high quality conversation with no off topic chitchat moderated by some of the best in the business then that's really what you're looking for.
We feel like we do here, some of the free online chat rooms are very low quality in terms of what you know people are taking. positions and try to push them and say stocks are going to the moon and all that kind of nonsense that can really get in the way if you are trading instead of helping you and providing useful information, so now it's probably better for you to explain this than me . but Nate, what do you think are the most useful things about the underground investor chat room and what really separates us from the rest of the chat rooms, given the assets we have in the room every day? biotech traders, you name it, we have it and we essentially have all bases covered, we have breaking news as it is released and stocks that are breaking out that I and a dozen other traders may be missing out on. here it's one of a thousand different names to post, hey, you know this one is taking off and it immediately goes off in your head that, hey, that was being scanned for a leak, I want that on the radar, I wanted to buy it and I immediately look at you. knowing where a decent entry would be, otherwise I probably would have missed it, so really thousands of eyes is better than just two eyes on a scanner and you know the focus is on moving actions, momentum and practical ideas, and It's good to know where the volume is. comes at any time, sometimes you just see a big spike in a stock that maybe you're playing or thinking about trading, but no one really knows what's going on, suddenly someone posts it because they're monitoring it and they saw Or another chat room alerted to buy it or you know someone on CNBC said something, whatever it is, again, it's about the eyes working together to accomplish one thing, so besides scanning at night, my main tool is chat.
Twitter is fun. Honestly it's constantly changing, it used to be a huge asset now it's about 80% entertainment and 20% business and that may even be a stretch, it's less about who to follow now and when I use the word follow I don't mean it, and - So I bought so you know I'm buying. When it comes to following, I mean who are you following and who is worth following, and the best part of that is that you can see why certain things are moving if you have a particular stock that if you are interested in, has a great search function where you can type the money symbol and a sign to find out the XYZ money sign and it immediately appears, probably many, many results in real time and you can see: Hey, did anyone just do this? mention that you made a newsletter, just do it, what's the reason for the change and a lot of times it's actually faster than you think, new services other than that, I mean it's really gone downhill as far as quality, You should never listen to anyone on Twitter and you should never ask for advice on Twitter, you will get a lot of comments, especially if it is a stock that is in the gutter.
You know, I'm sure a dozen people will tell you why you should keep it. mnk D, for example, humanity in a V Excel, a V Excel is funny, every time you mention it negatively you'll probably get at least ten people telling you why it's going to the moon and why you should hold onto it in the meantime. Know 50 60 90% of the current year, so you always have to be careful with that, but like I said, it's a great resource to find out why things are moving at a given time, but it's not a good place to get quality , not necessarily advice, but answers. to questions about Tiggers, a lot of what we trade are ex-traders and people remember names, they remember what stocks they trade, especially in small cap lands, where the same jump just goes from cycle to cycle and what I mean with cycle is that you know they push. if it goes from one to five dollars, it goes back two, it goes to three and then it slowly fizzles out to fifty cents, forty cents and so on after a big money raise or something like that and then they'll end up doing a reverse split and we'll talk about that more Go ahead if you're not familiar with what each first split is, but essentially it's a restructure, so for example, if a stock goes down to 50 cents, they'll do a reverse split, let's call it one four ten.
The shares will now trade for five dollars, but you will have one tenth the number of shares, so a lot of times this happens with stocks that we have seen over and over again former brokers that have run in the past before, but just continue in this continuous cycle where that stock that just did the reverse split and is now at five could go down to two or three and then go up to five or seven or fifteen and then it's just a slow, steady six months of pullback. reduce to fifty cents and then do it again so you start to notice that you see a lot of the same tickers year after year going back up and sometimes they even change tickers so that's another story but it's also helpful to know what the ticker is.was before because if you know it was run before, it basically allows you to not underestimate it on the short side, you know, get ahead of yourself too early and then end up losing a shirt or at the same time it could help you maybe.
I am confident in a long potential to build on the momentum they are building again. Thanks Nate, people always ask if there is a list of former runners we can send so you know which ones have gone before so you can prepare. Consequently, and the answer is no, the library or complete list of former racers is almost endless and always changing. You know, if we send out a list in six months, there will be two dozen new runners and some of the old ones will be forgotten. I think the key is that if you are in front of your screens every day trading the markets, you will often be exchanging these names and they will leave some kind of little imprint in your memory and the next time you see them in your list of days of the hive flashes making a move, remember?
Hey, I traded that a year ago when it was five bucks, now it's 50 cents and it's coming off a lot of support with a lot of volume, it might be worth the trade and I'm not trying to make a blatant add here but it really is another reason why which the clandestine chat for investors is a great place. You know, we have hundreds of members there during the day and everyone has their own memory, some better than others in terms of the above. brokers who have been active in recent years within the chat room itself, so the chat room is a hole that rarely misses a beat when it comes to former brokers getting pumped up and having a subsequent move, in terms of putting it all together and wrapping it up.
You really have to determine where you fit in the market and that will guide you towards what type of scanning strategy will be best for you. If you are a very proactive person, you will focus a lot of your energy on preparation the night before so that you really know what you are going to trade the next day. If you are a very reactive person, then you are probably playing with fire a little during your trading, but you may want to focus a little. a little more on a live scanner and chat room to follow the action and see if anyone is talking about stocks you might want to trade and the last two points are very important: patience and diligence, do you have the diligence to do your homework ?
All the charts ensure that you know what you want to trade and then do you have the patience to make sure that it is set up intraday and that the chart represents a very solid reward for your risk before you enter the trade and commit your capital? We really think we know these four points in the underground investing community for proactive people. We do scans every night for reactive people. We have the chat room and patience and diligence are a byproduct of surrounding yourself with the best operators and observing. the way they do things and make mental notes on how you should act when approached in the markets, so that's almost wrapping up today's lesson, the next video we'll be posting will talk about the ins and outs of choosing a trading subscription service if If you have any questions about this video or just want to communicate with you about your trading, you can email me. chat, contact me, this has been a chamber for underground investors, good luck with your operations.
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