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Range Contraction Stock Scans
This set of scans helps to find stocks which are experiencing a constricted trading range. The basic idea being that stocks continually cycle between phases of low volatility (range contraction) and high volatility (range expansion). So these can help to pinpoint trading opportunities in stocks which may be ready to enter a high volatility phase. In short, these can help you to get ahead of price breakouts or breakdowns.
Name Description
BB Squeeze + Lower Band Touch Stocks in a Bollinger Band Squeeze which touched the lower band.
BB Squeeze + Upper Band Touch Stocks in a Bollinger Band Squeeze which touched the upper band.
BB Squeeze Started Stocks which started a Bollinger Band Squeeze today.
Bollinger Band Squeeze Volatility has fallen to low levels and the Bollinger Bands Bandwidth has narrowed to near 6-month lows.
Boomer Buy Setup Rules (via 'Hit & Run Trading'):
  • ADX must be more than 30 and the +DI more than the -DI.
  • Stock must make two consecutive inside days.
  • On day 4 (the day after the second inside day) buy 10 cents above the high of the second inside day bar.
  • Place your initial protective stop 10 cents under the low of the second inside day.
      		•
      Boomer Sell Setup Rules (via 'Hit & Run Trading'):
    1. ADX must be more than 30 and the -DI more than the +DI.
    2. Stock must make two consecutive inside days.
    3. On day 4 (the day after the second inside day) sell short 10 cents under the low of the second inside day bar.
    4. Place your initial protective stop 10 cents above the high of the second inside day.
        		5.
        Calm After Storm This finds stocks which have recently had a siginificant range expansion and are now experiencing range contraction. A trader can use the contraction to anticipate a return to an expansion phase. One idea would be to enter a trade as price exceeds the range of the contraction bar with a stop-loss at the other extreme of the contraction bar.
        Inside Day Stocks which made an inside day (a higher low and a lower high than the previous day).
        Jack-in-the-Box Bearish Rules (via 'Hit & Run Trading II'):
      1. Day 1 - Stock must make an expansion breakdown (XBD).
      2. Day 2 - Stock must form an inside day.
      3. Sell short the day after the inside day, 5 cents below the XBD day's low and risk one point.
      4. If the stock closes strongly (weakly) in the bottom of the day's range, hold at least half of your position overnight, as it's likely to follow through the next day.
          		5.
          Jack-in-the-Box Bullish Rules (via 'Hit & Run Trading II'):
        1. Day 1 - Stock must make an expansion breakout (XBO).
        2. Day 2 - Stock must form an inside day.
        3. Buy the day after the inside day, 5 cents above the XBO day's high and risk one point.
        4. If the stock closes strongly in the top of the day's range, hold at least half of your position overnight, as it's likely to follow through the next day.
            		5.
            NR7 Narrowest range in the last seven trading days. This shows range contraction. Range contraction often leads to range expansion.
            NR7-2 Second day in a row of NR7s
            Narrow Range Bar Volatility Contraction: Today's price range was less than half of the average true range.
            Three Weeks Tight Stocks which formed a Three Weeks Tight Pattern