Good Screens for Bad Trading Days

Some of the best days to run screens are the worst days in the market.  Whenever I find a daily or weekly period that makes a significant reversal to the prevailing trend (like today) I spend a lot of time looking for opportunities.  Last week, was also a great time for me to sift through stocks because of the low volume that was systemic since Tuesday.  If the market has abnormally low volume for the week, I screen for any stocks that came within 10% of average volume for the preceding 4 weeks.  If the stock was trending higher prior to last week and it managed to maintain normal volume with an upward price move, that is usually a stock I want to watch.  The same goes for stocks heading lower.  Any stock that trades actively in a dull week is not dull.  The simple screen that I like to use on down days like today is any stock that heads higher, regardless of volume.  I know it’s a basic divergence tactic, but the KISS principle works well on extreme days.  Unless it’s an obvious contrarian play (like a homebuilder going up when rates go down unexpectedly), any stock that bucks the trend of the market deserves additional attention.  If you are not selling today, you should be looking for stocks to buy - maybe not buying them but identifying them is a little easier on a day like today.