Free online technical screener for Singapore and Malaysia listed stocks by tradeSignum.com. Predefined scan picks up wk-wk/ mth-mth/ yr-yr price expansion.
Price expansion as a trading signal
Based on Tflow® method of trading, price trend can be visualised as a series of expansions.
Any trending currency pair, stock, index or any commodity should exhibit a series of price expansions. A down trending security will print a series of bearish expansions i.e. lower highs lower lows. An up trending security will print a series of bullish expansions i.e. higher highs higher lows.
In a reversal, an expansion in an opposite direction of trend terminates the series of expansions that form the trend, sets up for a move in the opposite direction. In other words, an opposite expansion happens.
In a bearish reversal for example, an up trending currency pair prints a series of bullish expansions i.e. higher highs higher lows. A bearish expansion i.e. lower high lower low terminates the up trend and signals the beginning of a down trend.
This post ‘Price action trading can be easy with Tflow®‘ provides an illustration.
A rule-based approach to price action trading
- The start of a new trend is marked by price expansion in the opposite direction; previous lows (for bearish reversal) or previous highs (for bullish reversal) are penetrated
- Downtrend is a series of lower highs and lower lows (marked by red line). In this daily chart, understanding highs and lows using monthly levels make it easy even for beginners.
- Danger lurks when price makes false non-committal breaks. These give a semblance of reversal but could be wash N rinse movement.
- There are instances when a period such as this inside month where price does not move out of both North and South boundaries. Instantly traders may recognise a consolidation pattern. Trading should switch to a range trading approach. If in doubt, trend riders should stick to previous trend i.e. down.
- When a genuine reversal happens, it is marked by price expansion again. In this bullish reversal, price breaks the previous month high. Decisive breaks are often clear to recognise and not ambiguous.
- As long as the previous low is not violated, the trend remains up.
This is an EURCAD illustration of using boxes in Tflow® Analysis to identify trend
What is an easy way to scans stocks for expansion signals?
For forex traders, futures traders, this is relatively easy – just inspect the charts one by one. Most forex traders trade a handful of currency pairs. Even if one was to trade a good spectrum of majors, crosses – a good number like say 30 forex pairs, going through one by one is still easy. Stock traders and investors will have a problem. Even a relatively small exchange like Singapore Exchange has up to 800 stocks. Even if one were to discard, penny stocks, illiquid counters, a good watchlist could easily have up to 100 stocks if not more.
Having a good charting platform so that price expansion can jump out visually, plays an important part of scanning. I personally use more than 5 different charting platforms including MT4 and Amibroker but only MT4 and Tradingview.com satisfy this requirement. Both however do not have data for the stocks I am looking at (mostly Singapore and Hong Kong stocks).
Free online technical screener by tradeSignum.com
This Malaysia-based online stock screener provided free of charge by tradeSignum.com is very useful. TradeSignum carries stock data from Singapore Exchange and Bursa Malaysia. Besides a free online scanner, there is also an interactive chart plus information, education elements.
Predefined technical scans for ‘New 4 Week High’, ‘New 4 Week Low’, ‘New 52 Week High‘ and ‘New 52 Week Low’ are available.
For investors, traders who are looking for week – week, month-month bullish/expansion, this can be done by choosing either ‘New 4 Week High’ (for up trend) or ‘New 4 Week Low’ (for down trend). Take the screening results, check against chart to verify. ‘New 52 Week High’ and ‘New 52 Week Low’ will pull out stocks that may fulfil year – year bullish/bearish expansion.
There are many predefined technical screens to choose from. Sophisticated users who want to define own scanning rules can make use of Custom Technical Screener.
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Soh Tiong Hum is Director of TerraSeeds Market Technician Pte Ltd. TerraSeeds is a trading educator in Singapore since 2005.
Soh's Twitter account @sohtionghum
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"I do not have a financial advisor's license. I am not qualified by any regulator to give financial advice. I do not know you the reader. Your investment means and motive may be different from me. My posts here are based on observations and meant for education. I am not responsible for for any consequence from your actions."