Investing With Options header image ≡ Menu

Just Released: Get Your FREE Iron Condor Trading Toolkit


Click Here to Download

Get This Short Stock Screener that Works In Up Markets

Are you ready for the market turn?

Maybe... it's not profitable to try to catch tops.

But there is a way to short stocks that works even when the market trend is up.

During market rallies, we see a "market of stocks" instead of a stock market.

That means correlations are low, and it really is a stock picker's market.

The bet way to short stocks in this environment is to not pick tops.

It's to look for what I call "fund impatience."

The Short Stock Screener

The background thesis is very simple-- during market runs like this, if a stock is not going higher, funds get impatient waiting for the move and will continue to cycle out of that stock.

And if the market does turn, generally the trend will accelerate to the downside.

Here are the screen criteria:

  • stocks only
  • optionable
  • average volume: 500k
  • institutional ownership > 50%
  • stock under 20, 50, and 200 moving averages

You can view the scan here.

I think this stock screener works best when the market has had a run-- if the market is selling off hard, there will bee too many stocks in this list.

Here are some of my favorite ideas right now from that list:

$AMZN looks good for a breakdown

 

if $CLF loses 65 we should see a nice 5 point move

$FDO has a heavily defended level at 53. Watch for a breakdown.

by Steven Place

Steven Place is the founder and head trader at investingwithoptions.com/