Finding High-Volatility Stocks to Day-Trade

Checking stock prices on a smartphone and on a computer.
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Day traders often focus on high-volume stocks that are seeing significant price movements, because those stocks offer the best opportunities for making money quickly. You can use an online stock screener, or stock filter, to find stocks that meet those and other criteria.

You can use screeners in different ways to find stocks that often experience lots of price volatility on high trading volume, ones that are likely to be volatile and highly traded on a particular day, or ones that are showing volatility during a certain time of day.

Searching for Regularly Volatile Stocks

To search for stocks that routinely display high volatility and heavy trading volumes, go to StockFetcher.com or another screener of your choice. If you're on StockFetcher, click New Filter and copy and paste the following lines into the pale-yellow area:

show stocks where the average day range (50) is above 5%
and price is between $10 and $100
and average volume (30) is greater than 4000000
and exchange is not Amex
add column average volume (30)
add column average day range (50)

Then click Fetch Stocks! to get your results. You can see the first five stocks for free. (To see more than five—and to see results for the most recent trading day rather than the day before that—you can subscribe to StockFetcher at one of two price levels.)

The filter criteria sorted out stocks that:

  • Typically move more than 5 percent per day, based on a 50-day average. Use at least 50, but maybe 75 or 100, for the number of days, because that will mean the stocks have moved significantly, with regularity, over an extended time frame.
  • Are priced between $10 and $100. You can alter those amounts to suit your preferences.
  • Had average trading volume during the past 30 days above four million shares a day.
  • Are not actually individual stocks but leveraged ETFs. (If you want to include that kind of ETF in your search, delete "and exchange is not Amex.")

    The "add column" commands enable you to see at a glance which stocks had the biggest average trading ranges and volumes.

    Run that search on a stock screener each weekend. Pick two or three stocks from the list and trade them for the week. Repeat the process and note your successes and failures. Adjust any of the criteria as needed to get a list of stocks that are better suited to your day-trading strategy or specifications.

    Analyzing Stocks Daily

    Another approach is to monitor for stocks that are likely to move big each day. The list may consist of stocks that were very volatile during the prior trading session or had the biggest percentage gains or losses. Add in a volume filter to make sure the stocks are suitable for day-trading, which generally means at least one million shares change hands daily.

    You can set up that search easily on FINVIZ.com, another free stock screener. Click the Screener tab. Click the arrow to the right of Signal and select Most Volatile, Top Gainers, or Top Losers. Under Filters, click the arrow to the right of Average Volume and select Over 1M. If you want to exclude ETFs, click the arrow to the right of Industry and select Stocks only (ex-Funds). Increase the average volume level to reduce the number of stocks in your list of results. 

    You might also want to check each morning which well-known stocks—with good volume—have earnings releases due out. Announcements about a company's quarterly profit or loss often cause big price moves. Be prepared to trade as soon as the news is announced; that's when the volatility occurs and when day traders can potentially capitalize. Yahoo! Finance provides an earnings calendar that lists companies releasing their financial results that day.

    These approaches will produce a significant number of stocks, requiring you to narrow down the list to a handful you want to watch and potentially trade that day.

    Monitoring Intraday Volatility

    Another alternative is to do some research during the day to find the stocks that are moving the most. You can list the Most Volatile, Top Gainers, or Top Losers on FINVIZ.com or TradingView, another free screening and charting website. Most brokers and trading platforms will also provide this information in real-time.

    Note changes in the list throughout the day. If a stock opens down 10 percent and stays there, you're not going to see any day-trading-worthy action. But if a stock opens down 10 percent and then you notice it's down 11 percent, 12 percent, or 13 percent—or it's back up 5 percent—that stock is moving and may be worth taking a look at for a trade.

    FINVIZ.com also provides a list of stocks that are breaking through resistance levels or sending another technical indicator trading signal. With a paid subscription, you can follow these intraday signals in real-time.

    The Balance does not provide tax, investment, or financial services and advice. The information is being presented without consideration of the investment objectives, risk tolerance, or financial circumstances of any specific investor and might not be suitable for all investors. Past performance is not indicative of future results. Investing involves risk including the possible loss of principal.