BC TRADERLION
Saved by @SeekerHari

There are thousands upon thousands of stocks that you can trade.

But how do you narrow it down to the best of the best?

In this thread, we'll highlight the 3 most important steps you need to take to create a Focus List (& how you can apply these lessons immediately)

👇🧵

 By the end of this thread, you'll be able to:

✅ Scan quickly and effectively to build a Universe List
✅ Narrow it down further to a Weekly Focus List
✅ Find the best stocks possible to trade

It's that simple so let's jump in.
· Scan quickly and effectively to build a Universe List

🔎 Pullbacks
🔎 Breakouts
🔎 High Volume
🔎 Fundamentals
🔎 Momentum Edges

Here are the criteria you can use in your favorite scanning platform for each:
Pullbacks Edge 🚨:
· Above your favorite Key Moving Average Scan (> 10EMA, 21EMA, 50DMA)
· % Off Highs Scan (< 20%)
· Reverse Pocket Pivot Scan
Breakouts Edge 📈:
· 52 Week High Scan
· Volume > 2x Avg. Scan
· Price > 5% on Session Scan
High Volume Edge 📊:
· Highest Volume in > 1 Year (HV1)
· ShortStroke (>10% move over prior 5 sessions)
· Pocket Pivot Scan
Accelerating Fundamentals Edge 🔢:
· Accelerating Sales Scan
· Accelerating EPS Scan
· EPS + Sales Combo
Strong Growth Edge 📘

· Most Recent Qtr EPS > 40%
· Most Recent Qtr Sales > 40%
· Fund Ownership Increasing QoQ
Momentum Edge 🚀:

· % Price Increase over 2 Months > 100%
· Price > $5
No matter what type of trader you are, you must have a screening routine that identifies the top stocks for your strategy.

Take the examples above and implement them into your routines.

Once you have this pool of ideas, the next step is to organize them into your watchlists.
At TraderLion, we sort the results of our scans into 3 separate watch lists. They are the following:

✅ IPO WL
✅ Gappers WL
✅ Hight Tight Flag WL

This is the universe of stocks we have at our disposal - usually totaling no more than 120 names in a good market.
Here are some of the criteria that we look for out of newer issues to make our IPO Watch List:

· Proper P/V from IPO (up on volume, down on low volume)
· Highest Volume Since IPO w/ Strong DCR (HVIPO)
· Huge RS from IPO, RS Zones/Periods
· Strong Fundamentals
Criteria for Gappers Watch List:

· Highest Volume Ever (HVE)
· Highest Volume in 1 Year (HV1)
· Strong DCR of over 50% during these sessions

This is a direct example of how our scanning routine above plays right into our watchlist creation.
Here are some of the criteria that we look for stocks to make our HTF Watch List:

· % Change 2 Months > 100%

This is another direct example of our momentum edge screen from above that is implemented into our daily processes.
That's it.

By separating your stocks into 3 separate watch lists, you will be able to track all of the best names in an orderly and organized manner.
Of course, the question of this thread now that we have a universe list is how do we narrow it down into a Focus List?

Here is the answer 👇
Each night, you want to go through your respective Watch Lists and jot down the names that will be the most actionable for tomorrow’s session.

The edges and setups should be clear and there should be a specific pivot point you are watching.
This means we are looking for names that are:

✅ Above KMA’s
✅ Tight Price Action
✅ Low Relative Volume
✅ Showing a Constructive Pattern
As your eyes glance across charts that meet these criteria, write down those tickers along with the setup and buy point.

This should be part of your daily routine.
Next, it's time to focus on the best and most actionable names.

Be objective and ruthless in selecting these.

Go through your list and pick out the 5-10 best of the best names.
That’s it! You’ve now…

✅ Built Scans for your Universe
✅ Created Routines to capture these names
✅ Simplified a list of 5-10 names that will be your FOCUS next session!
It’s best to sum this thread up with a couple of real world examples of times stocks should have / should not have made your focus list.
Example 1: $TSLA in 2022
As we can see in the example above, $TSLA had a period in which it traded near its highs, above all the KMAs, and in a tight/orderly fashion.

This is exactly what we are looking for out of a name to make our focus list.
Clearly though, the continuation pattern it created did not last as the market rolled over and took TSLA with it!

This is why it is incredibly important to always practice proper risk management strategies.
Example 2: $OXY in 2022

$OXY is a great example of a chart that would have been perfect for a KMA Pullback buy - worthy of making your focus list as it showed everything we look for!
We can see that it had an orderly (Low Relative Volume, over multiple sessions) pullback to the 20ema, and then was able to bounce in a big way.

That is very different different action than what we are currently seeing with the oil stocks.
Example 3: $ENPH in 2022

$ENPH shows exactly why having Group Relative Strength isn’t quite enough to move a name on to our FOCUS list - but definitely could be one that is worthy of your universe list..
Final Takeaways on Focus Lists:

🔥 We must be sticklers & only accept the best names onto our focus list.

Focus = results.
🔥 If there aren't any names on your focus list, don't trade.

Don’t ever fall into the trap of not having ‘enough names on your focus list’ and start trading sub-optimal names because you want the action.
🔥 It is very important to never get tied to one stock just because it acted well on your focus list before. Never fall in love.

There is a time to trade stocks as they meet your criteria and a time to ignore them and be patient until they set up again.
That's a wrap!

If you enjoyed this thread... 👇

1. Follow @TraderLion_ for more helpful threads on the market!
2. Like & RT the tweet below to share this thread with your audience https://t.co/eAsberggbK

More from TraderLion 🦁

TraderLion
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20 lessons from trading legend Stan Weinstein:

Volume is a gauge of how powerful the buyers are... Never trust a breakout that isn't accompanied by a significant increase in volume.

1/20
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TraderLion \U0001f981
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@TraderLion_
There is only one proven way to prevent blowing up your account:

Setting Stop losses.

Properly setting & implementing stop losses will save you millions over your career.

Here's a top down guide with everything you need to know about Stop Losses, broken down step by step 👇🧵

In this 🧵, we'll cover:

· The Goal of Stop Losses
· How to Place a Proper Stop Loss
· Answers to Frequently Asked Stop Loss Questions
· General Guidelines to Protect Your Account

& tons of examples!

Let's jump in 💪

Overall Goal of Stop Losses 👇

The goal of a stop loss is to cap your downside while maximizing the upside from proven setups.

It is impossible to be correct on every trade you make, so it is very important that you implement stop losses to contain your losing trades!

Let's look at some examples to show you how important stop losses can be:

$PTON (Weekly!)
$TSLA (2020 B/O)
$NVDA (1999 IPO B/O)
$AMPH (Last Week's Action)


In each of the examples above, you could have used proper stop losses to capture massive upside gains & protect yourself from huge downside losses!
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TraderLion
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How To Execute when Trading (Thread)

Trading is a matter of preparation, discipline and execution.

Execution is about reacting to what we see on the charts in accordance with what you have already planned out when the market is closed.

The reason we plan our actions beforehand is because our emotions are at a lower state and we are more objective at that point in time.

Many traders often have the same watchlists going into the week but when the opening bell rings and setups emerge, the traders who can execute have the best performance.

Trading execution begins with research and preparation.
ALL , TRADERLION
TraderLion
TraderLion
@TraderLion_
What to do if you are not trading well. (Thread)

Impatience and instant success are built into our minds from the get-go. We want instant wins and instant rewards.

This has as much to do with our psychological build-up as it does with the society we live in.

In this thread, we will cover:

What to do if you are not trading well.
How to stop the drawdowns when no progress is being made.
How to have a systematic process that protects you from yourself.

So what is it that drives us?

We all want the market to reward us for our hard work, the effort, and time we put into it.

We want input to equal output.

However, there is no such thing as input = output in trading.

Trading is about consistency, persistence, and hard work without the certainty of any reward.
TRADERLION
TraderLion \U0001f981
TraderLion 🦁
@TraderLion_
The market’s best investors have made millions from the simple saying:

“Buy right, sit tight”

Sounds simple - but what does “buying right” even mean?

Use TraderLion's 10-Step Ultimate Guide to buying right 👇

By the end of this thread, you'll know how to:

1. Build an objective list of buy criteria
2. Have 10+ real world examples to study
3. Increase your win rate.
4. Increase your profitability

Let's dive in!

Buy Rule #1: The General market must be in an uptrend.

3 out of every 4 stocks follow the market trend both to the upside and to the downside.

This means that if you are buying a breakout in a downtrend, it already has a 75% chance of failing!

It doesn't matter if the stock is in a leading group with an impressive RS line and strong fundamental story.

At the end of the day, market direction is the MOST important factor!

Here's an excerpt from How To Make Money In Stocks by stock market legend William O'Neil:


Here's another video by @richardmoglen that will help you determine if the stock market is in a downtrend:

https://t.co/shD5OjkP6s

Let's move on to #2.
TRADERLION

More from Traderlion

TraderLion \U0001f981
TraderLion 🦁
@TraderLion_
8 Chart Patterns by William O'Neil

Let's break them down one by one🧵


Perhaps the most famous basing pattern found in the market is the Cup with Handle pattern.

✅ Chart resembles a cup with a handle
✅ Base length: Minimum 7 weeks
✅ Base depth: 20-30%
✅ Buy point: high of the handle
✅ Handle length: 1 week
✅ Handle depth: no more than 15%


There is also a Cup without Handle pattern.

✅ Chart is just a cup, no handle
✅ Base length: Minimum 7 weeks
✅ Base depth: 20-30%
✅ Buy point: High of left side of cup


The Double Bottom chart pattern is also very common & is one of the most powerful patterns to learn.

✅ Base resembles a "W"
✅ Base length: Min. 7 weeks
✅ Base depth: < 40%
✅ Buy point: middle of "W"
✅ Second low must undercut first low


The Flat Base pattern is another well known structure coined by William O'Neil.

✅ Base resembles a shallow consolidation
✅ Prior uptrend must be greater than 30%
✅ Base length: Minimum of 5 weeks
✅ Base depth: < 15%
✅ Buy point: High of structure
TRADERLION , ALL , CHARTS
TraderLion \U0001f981
TraderLion 🦁
@TraderLion_
The market’s best investors have made millions from the simple saying:

“Buy right, sit tight”

Sounds simple - but what does “buying right” even mean?

Use TraderLion's 10-Step Ultimate Guide to buying right 👇

By the end of this thread, you'll know how to:

1. Build an objective list of buy criteria
2. Have 10+ real world examples to study
3. Increase your win rate.
4. Increase your profitability

Let's dive in!

Buy Rule #1: The General market must be in an uptrend.

3 out of every 4 stocks follow the market trend both to the upside and to the downside.

This means that if you are buying a breakout in a downtrend, it already has a 75% chance of failing!

It doesn't matter if the stock is in a leading group with an impressive RS line and strong fundamental story.

At the end of the day, market direction is the MOST important factor!

Here's an excerpt from How To Make Money In Stocks by stock market legend William O'Neil:


Here's another video by @richardmoglen that will help you determine if the stock market is in a downtrend:

https://t.co/shD5OjkP6s

Let's move on to #2.
TRADERLION
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TraderLion
TraderLion
@TraderLion_
10 Lessons I Learned While Working With William O’Neil (Thread)

↓

1. The importance of trading psychology and emotional/physical well-being

Trading psychology and physical/emotional well-being is probably one of the least discussed, yet most important aspects of becoming a successful trader.

However, the large majority of traders spend little time if any focusing on this aspect of their trading and instead, dedicate their time to methodology, technique, and “special indicators.”

Start by taking good care of your physical and emotional health.

This means getting enough sleep, eating well, exercising, etc.

Next, pick up a couple of books and study trading psychology. Two excellent books on this subject are, “Trading in the Zone,” by Mark Douglas and “The Psychology of Trading,” by Brett Steenbarger

2. The importance of sound rules to avoid emotional decision making.

Having a sound set of rules that are proven to work is essential to success in the stock market. Why is this so important? Two words. Human nature.
PSYCHOLOGY , TRADERLION
TraderLion
TraderLion
@TraderLion_
An Introduction to CANSLIM (Thread)

CANSLIM is a growth stock investing strategy developed by William O’Neil.

O'Neil was the founder of Investor's Business Daily and in 1964 he became the youngest person to ever purchase a seat on the New York Stock Exchange at age 30.


O’Neil's success came from studying the greatest winning stocks of all time and the methods of the most successful investors of all time including Bernard Baruch, Jesse Livermore, Gerald M. Loeb, Jack Dreyfus, and Nicolas Darvas


From this research, he distilled 7 key characteristics which showed up again and again in the top-performing stocks of every market cycle.

Together they form the acronym CANSLIM

Current Quarterly Earnings Growth
Annual Earnings Growth
New Products/Services/Management/Price Highs
Supply and Demand
Leader Versus Laggard
Institutional Sponsorship
Market Direction
TRADERLION
Richard Moglen \U0001f4fd\ufe0f\U0001f981\U0001f6a2
Richard Moglen 📽️🦁🚢...
@RichardMoglen
5 Ways Weekly Charts can help your Trading & Investing

📈📉 (Thread)

Weekly charts are a powerful timeframe, and regardless of your style, they can help you gain perspective on a particular setup and identify its potential

Using higher timeframes slows the action down and allows you to calmly analyze price and volume.

This will lead to better decision making.

For investors learning to analyze weekly charts and their trends can only complement your fundamental analysis.

For traders they are the "prevailing wind" and trading with this weekly trend will increase probabilities and help you remember to focus on larger patterns

1⃣ Weekly Charts show the True Trend of a Stock

Weekly charts eliminate a lot of the back and forth that occurs intraday and on daily charts. What is left is often a clear picture of the trend of a stock.

⬆️ Trending Up
↔️ Basing
⬇️ Trending Down
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