This strategy uses PreMarket Scan in combination with eSignal (with NASDAQ Level II option).

This strategy is, by no means, the only way to use PreMarket Scan, nor is it guaranteed to ensure profits for those who use it. But, for the trader with a moderate amount of experience in the market and an understanding of how the features of the tool work, it can be very effective.

1. (Optional step) As soon as possible after 8:00 a.m. Eastern Time, and before the market opens, observe the percent gainers / losers with a minimum volume of 8k and a minimum average daily volume of 500k. (These are the two qualifiers that figure prominently in the subsequent steps of this strategy.) In this time frame, it is also important to read breaking news stories. In PreMarket Scan, select % Gainers in "Scan Type." Set Minimum Volume to "8k." Set Minimum Average Daily Volume to "500k." Click, "Go." Repeat for % Losers.
   
   
2. As soon as the market opens (up to a half-hour after the open), use the "% Gainers" option of PreMarket Scan to make your initial picks. Select as follows:
   1. All Sectors
   2. All Issues
   3. A price range according to the user's habits
   4. Minimum Volume of 8k
   5. Minimum Average Daily Volume of 500k
      
      Then take the following steps:
      
      
   6. At the bottom of the screen, under "Columns," select, "% Change" and "Volume" as a minimum for purposes of comparison throughout the session.
   7. Press "Go."
   8. Select approximately half of them or 10 to 20 issues, starting from the most profitable (the top of the list).
   9. Copy and paste them into an eSignal Quote window (suggested layout: Basic 1 in the Layout menu). It is important to have the following column choices set up in your Quote window: "Symbol," "Pct (Change from Previous Close)," Pct (Change from Open)," and "Vol." Set up the 2 "Percent Change" columns by right clicking a column heading and selecting "Add Field" and "Change, Percent." Right click Pct column heading and modify "Compute Change."


3. Now use the "% Losers" function of PreMarket Scan to make your next choices. Use the same a) through i) steps as above (except that you are now choosing half or 20 of the least profitable, again from the top of the list).
   
   You should now have a range of 20 to 40 stocks in your eSignal Quote window. Become familiar with these stocks, at least by name.
   
   
4. At approximately 15 minutes after the market opens, you are ready to do your first eliminations from your list of focus stocks. Sort by left clicking "Vol" column heading. Get rid of low-volume stocks with a daily volume of <75k shares by highlighting these stocks and pressing "Ctrl X" (clears out the information and deletes the rows). (Try to avoid making more than 5 to 7 deletes in any one elimination round.)
   
   
5. Do your next two cuts at a half-hour into the day's trading. First, eliminate all stocks that are down more than 10 percent as measured by "Change from Previous Close." (Remember to sort by column heading first.)
   
   
6. Now, eliminate stocks down more than 7 percent as measured by "Change from Open."
   
   
7. You should now have a list of approximately 15 stocks, a number that can be fairly easily tracked throughout the day.
   
   Note: To ensure that symbols no longer being tracked are cleared from the Data Manager, you may have to use "Clear Cache".
   Go to: File, Preferences; in the window that comes up, select "Clear Cache" choice and hit "Okay".
   
   
8. (Optional step). If you have more than 15 stocks, one way to eliminate some would be to select and delete stocks down 5 to 10 percent as measured by "Change from Previous Close" that are also down greater than or equal to 5 percent as measured by "Change from Open" until you reach the desired number.
   
   
9. Keep your picks open in eSignal to observe their progress throughout the day. (eSignal's predefined layout Basic 1 in the Layout menu is a great tool for monitoring momentum.) The steps from this point on depend very much on individual traders' own knowledge, ability and risk tolerance.
   
   
10. 10:30 Eastern Time is often the first decision point of the day -- time to buy. One option for decision-making might be to do a "Change-from-Open" sort in eSignal and concentrate on the top 5. Read news stories and look at the charts for these 5.
    
    
11. Another option might be to copy all 15 of your picks and paste them into the NASDAQ Level II Market Maker Activity Ticker found in the Basic 1 layout and watch the activity there. Look for high bids from institutional market makers, such as GSCO, MSCO, MLCO, SBSH and JPMS. You can also view these market maker moves in eSignal's Market Depth window (an add-on to eSignal).
    
    
12. Checking your list of 15 against Power Scan (the market scanner that keeps track of the best trading opportunities from the opening bell to the close) will often show that, of your 15, an average of 6 will be the best stocks to have traded that day as measured by "Change from Open" on Power Scan.

In addition, this list will keep pace with the entire market. For example, if the top 3 stocks in your list have a "Change from Open" of 10 to 12 percent, the very best stocks that day will also be up 10 to 12 percent (as measured by "Change from Open"). Again, exercise caution with volatile stocks. Use all the necessary decision support tools.