Stock Screening and Ranking - Example #7

OBJECTIVE: Find stocks in an uptrend, as defined by the 9 day ema being above the 20 day ema which in turn is above the 50 day simple moving average.

1. Click the “Scan / Rank” button along the left edge of Lighthouse Trader. This will open up a new scanning window.
   
2. You will see the “Available Item” list in the lower left corner of the window. Double-click on the “Comparison Operators” label to expand this branch and show all of its members.
   
3. Click and drag the “Above/Below” filter item over to the “Selected Item” list.
   
4. You will see the following popup window.
   
   Choose “greater than” and click OK.
   
5. Double-click on the “Indicators” label to expand this branch and show all of
   its members.
   
6. Click and drag the “moving average, exponential” indicator, dropping it on the “Above/Below” filter item in the “Selected Item” list.  The following popup window
   will appear.
   
   Set “periods in moving average” to “9” and click the OK button.
   
7. Click and drag a second “moving average, exponential” indicator, also dropping it on the “Above/Below” filter item. When the popup appears for the new indicator, set “periods in moving average” to “20” and click OK.
   
8. Click and drag a second “Above/Below” filter item, dropping it on the “Time Frame: daily” filter item in the “Selected Item” list. The following popup window will appear.
   
   Choose “greater than” and click the OK button.
   
9. Click and drag another “moving average, exponential” indicator, dropping it onto the new “Above/Below” filter item. The following popup window will appear.
   
   Set “periods in moving average” to “20” and click the OK button.
   
10. Click and drag a “moving average, simple” indicator, dropping it on the same “Above/Below” filter item. The following popup will appear.
    
    Enter “50” for the “periods in moving average” setting. Then click the OK button.
    
11. Your scan definition should look like the following. Click on the following thumbnail to see an enlarged example.
    
    
    
12. Click the Run button to view all stocks in an uptrend.

After viewing the results, you may decide there are too many low volume stocks appearing in the results. You can modify your scan definition as follows.

1. Click the “S” tab (along the right edge of the main Scan/Rank window.
   
2. Click and drag a “volume” filter item (in the “Data” group), dropping it on the “Time Frame: daily” filter item. The following popup window will appear.
   
   Click the “must be” radio button, choose “greater than” and enter “100000” in the text field for the required minimum daily volume.
   
3. The scan definition should now look like this. Click on the following thumbnail to see an enlarged example.
   
   
4. Once again, click the Run button to perform the scan.

Now let’s say you like the scan definition, but you would like to be able to rank the results based on the “strength” of the trend. You decide that the distance the 9 ema is above the 20 ema, expressed as a percent of the current price, will serve as a reasonable indicator of trend strength. Here is how to modify your scan definition to add the new column of data, the “trend strength” column.

1. Click the “S” tab (along the right edge of the main Scan/Rank window.
   
2. Click and drag a “%” filter item (in the “Arithmetic Operators” group), dropping it on the “Time Frame: daily” filter item.
   
3. Click and drag a “subtract” filter item (in the “Arithmetic Operators” group), dropping it on the “%” filter item.
   
4. Click and drag a “moving average, exponential” filter item, dropping it on the “subtract” filter item.
   
5. Click and drag a second “moving average, exponential” filter item, also dropping it on the “subtract” filter item. Set “periods in moving average” to 20.
   
6. Click and drag a “close” data item, dropping it on the “%” filter item.
   
7. The new scan definition should look like the following. Click on the following thumbnail to see an enlarged example.
   
   
   
8. Click the Run button to perform the newly refined scan, producing a new result table with the additional column.

Now you can sort the result table based on your new “trend strength” column to quickly
find the strongest trending stocks. This column should be the eighth column from the left, labeled “%(subtract(9 ema – 20 ema)/close)”.

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