A momentum scanner is a technical analysis tool that helps traders find stocks that are moving big, up or down. It scans the market in real-time and finds stocks breaking out of their ranges or showing strong momentum.

Perfect for day traders and active investors who want to stay ahead of the trend and make money. With a momentum scanner you can filter through thousands of stocks in seconds and find the ones that match your criteria, saving you time and improving your strategy.

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Choosing a Momentum Scanner

As a momentum trader there are a few key things to consider when choosing a momentum scanner. Let me break it down:

Market Coverage: The scanner should cover your desired markets – NYSE, NASDAQ, or other. Some scanners are specific to one exchange while others cover all.

Real-Time Data Quality: For momentum trading you need real-time data with zero latency. Look for scanners that provide true real-time updates not delayed quotes, momentum opportunities can disappear in seconds.

Customizable Filters: Key fields to include:

  • Volume vs average daily volume (unusual volume is a momentum indicator)
  • Price changes over different timeframes (1-min, 5-min, daily)
  • Market cap ranges (to match your strategy)
  • Float size (especially important for small-cap momentum trades)
  • Price ranges to match your account size

Technical Indicators: The scanner should support momentum indicators like:

  • Relative Strength Index (RSI)
  • Moving Average Convergence Divergence (MACD)
  • Volume-Weighted Average Price (VWAP)

Alerts: Customizable alerts that notify you of momentum opportunities based on your criteria, with both visual and audio alerts.

Best Momentum Scanner

There are various volatility based indicators available in most stock trading tools and brokerage platforms. We will talk about them in detail later. However, those indicators have limited capabilities. Day trading stock screeners allow you to find momentum stocks much faster and with more cleverness.

Trade Ideas

Trade Ideas is the unbeaten number 1 stock scanner for day traders. I have seen the best educators and trading coaches utilizing Trade Ideas to increase profitability.

Below you find an example of a Momo-scanner that helps you hunt for momentum. Trade Ideas is structured in a simple way. First, you configure your scanner by defining values for your preferred filters and alerts. Then Trade Ideas scans the stock market and displays the results.

You can use a few hundred filters, alerts and many different columns to configure the screener in the way you want.

The example below filters for explosive volume, which typically causes high momentum:

Trade Ideas momo scanner

Trade Ideas also comes with charting, backtesting, automated trading and more.

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Finding Momentum Stocks by Using a Stock Scanner

If you’re looking to find high momentum stocIf you’re looking to find high momentum stocks, there are basically two ways you can go about it:

  • A) You can bring up a chart – one by one – of each of the more than 3,000 stocks that are traded on the New York and NASDAQ stock exchanges combined and evaluate them in terms of trend direction and trend strength (i.e., momentum) or
  • B) You can use a stock scanner that will identify all the stocks that meet your specified criteria for defining “stocks with strong momentum” in just a matter of seconds.

Yes, “B” is a lot easier and less time consuming.

A stock scanner – also known as a stock screener – is a software tool that enables traders to identify stocks that meet a trader’s specified criteria quickly. One of the leading fundamental stock screeners is Stock Rover, which offers robust research tools and an extensive database for evaluating stocks. Its user-friendly web-based platform, comprehensive screening criteria, and integration capabilities with brokerages make it particularly appealing for buy-and-hold investors seeking in-depth analysis without engaging in intensive fundamental work.

A stock scan can be simple, such as a scan for stocks making a new 52-week high, or complex like a scan for stocks meeting multiple criteria, such as:

  1. Having a specified minimum amount of trading volume
  2. An ADX reading of 28 (or higher)
  3. Stocks that are up 5% or more on the day
  4. A net profit margin greater than 20%
  5. A debt-to-equity ratio less than 0.3

Some stock scanners offer to simplify scanning for high momentum stocks with their own proprietary momentum indicator that combines several price action factors. Most of these indicators allow you to add your own custom screening criteria if you wish.

There are various volatility based indicators available in most stock trading tools and brokerage platforms. We will talk about them in detail later. However, those indicators have limited capabilities.

Day trading stock screeners allow you to find momentum stocks much faster and with more cleverness.

Trading Strategies with Momentum Scanners

Momentum scanners can be used with many trading strategies to make more money:

  • Day Trading: Use a momentum scanner to find stocks moving big all day. This way you can trade short term and get in and out quick.
  • Swing Trading: If you like to hold positions for days or weeks a momentum scanner can help you find stocks breaking out of their holding patterns and showing sustained momentum.
  • Technical Analysis: Use a momentum scanner to find stocks with strong technicals, like moving averages and the relative strength index (RSI). These can be trading opportunities.
  • Trading Ideas: Use a momentum scanner to generate new trading ideas and find stocks that meet your criteria.

Using a momentum scanner will give you an edge in the market and help you make better and more timely trades. Whether you day trade, swing trade or use technicals.

FAQ

What Is a High of Day Momentum Scanner?

The high of day momentum scanner identifies stocks trading at the high of the day (HOD) with high relative volume.

What Is a Low Float Momentum Scanner?

A low float momentum scanner identifies stocks with low float and combines this filtered universe of stock with unfolding momentum. The low float of stock often leads to high volatility.