Lesson 05 · Getting Started
You have an account. Now the real question: out of thousands of stocks, how do you find the handful worth watching today? That is what a scanner and a watchlist do.
A scanner filters the entire market down to stocks that meet your rules (price, volume, movement).
A watchlist is the short, hand-picked list you actually monitor after the scanner does the heavy lifting.
The goal is not more stocks — it is fewer, better ones you understand.
Key filters for small-caps: price, float, volume, relative volume, and a catalyst.
Why you need a scanner
There are thousands of listed stocks. Manually flipping through charts is slow and random. A scanner lets you set conditions once and instantly see only the stocks that match — so your attention goes where the activity actually is.
For small-cap day trading specifically, the stocks that move are usually a tiny, changing group each day. A scanner surfaces that group in seconds.
The core filters (and what they mean)
| Filter | What it measures | Why it matters |
|---|---|---|
| Price | The share price range you want (e.g. $1–$20) | Keeps results inside your risk and strategy zone |
| Float | Shares actually available to trade | Low float stocks can move faster on the same volume |
| Volume | Total shares traded today | Higher volume = easier to get in and out |
| Relative volume (RVOL) | Today’s volume vs. its normal average | Shows unusual activity — often the first sign something is happening |
| % change | How far the stock has moved today | Highlights the day’s biggest movers |
| Catalyst | The news or reason behind the move | A move without a reason is harder to trust |
Rule of thumb: volume tells you a stock is moving; a catalyst tells you why. The best setups usually have both.
A simple starter scan
You do not need a complex setup to begin. A clean small-cap momentum scan often looks like this:
- Price: $1 to $20
- Relative volume: at least 3× the normal average
- % change: up more than 10% on the day
- Volume: at least a few hundred thousand shares (so it is actually tradeable)
That single scan filters the whole market down to a short list of stocks that are genuinely active today. From there, you check each one for a catalyst and a clean chart.
Free vs. paid scanners
Good enough to start
- Finviz (free screener — great for learning filters)
- Your broker’s built-in scanner (many now include one)
- TradingView (free tier with basic screeners and alerts)
For faster, live scanning
- Trade Ideas, Scanz, or a broker’s pro tier — real-time data and alerts
- Worth it later, once you know exactly which filters you rely on
Do not overspend early. Learn what each filter does on a free tool first. A paid scanner only helps if you already know what you are looking for.
Turning a scan into a watchlist
The scanner gives you candidates. The watchlist is where you narrow down to the few you will actually watch. A good daily process:
- Run your scan before the open and note which names keep appearing.
- Check the catalyst for each — earnings, news, an FDA result, a filing.
- Keep 3–5, not 30. You can only watch a few properly at once.
- Mark levels — the prices where you would act, before the market opens, not in the heat of the moment.
Discipline beats coverage. A short watchlist you understand deeply will always beat a long one you barely glance at.
An honest word on risk: a scanner finds movement, not opportunity. The stocks that top these lists are volatile by definition, and they are exactly where inexperienced traders lose money fastest. Most retail day traders lose money overall, and nothing here is financial advice.
Keep learning
Once you can find active stocks, the next skill is deciding which of them is actually worth your attention — and then reading the chart so you know where to act.
Compare brokers — many include a scanner built in.
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