These are my notes from the book, How to day trade for a living.
Chapter contents
- Float and market cap
Float and market cap
- Most low-float stocks are under $10
- Typically early-stage companies
- Usually not profitable
- Plans to grow
- By growing, they can raise more money by issuing more shares
- Typically early-stage companies
- Low-float stocks are also called micro-cap or small-cap
- Bull flag momentum strategy works best with low-float stocks
Real-time intra-day scans
- Some strategies will not apply to pre-market stocks
- The following strategies are suitable for intra-day trading
- Momentum
- Top reversal
- Bottom reversal
- You will need a different scanner to find stocks in play
Intra-day volume “radar”
Andrew has the following filters set up
- Gapped up or down at least $1.00
- Have ATR of more than 50 cents
- Have average relative volume of at least 1.5 (stock is trading at 1.5 times its normal volume
- Have average daily trading volume of at least 500,000 shares