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I've been reading through the following article about PreMarket Scan strategy:
In step 3, it states the elimination process for stocks that are falling i.e. isolate the biggest losers and keep a watch on them.
In step 4, it states to further eliminate stocks by virtue of lower volume - so that's gainers and losers.
In step 5, it states to eliminate stocks down by more than 10% from previous close. In step 6, further eliminate stocks down more than 7% from open.
So, unless I'm mistaken, is this strategy telling us to get rid of the biggest fallers? Is this because they've already fallen so much that they're unlikely to continue??
In step 3, it states the elimination process for stocks that are falling i.e. isolate the biggest losers and keep a watch on them.
In step 4, it states to further eliminate stocks by virtue of lower volume - so that's gainers and losers.
In step 5, it states to eliminate stocks down by more than 10% from previous close. In step 6, further eliminate stocks down more than 7% from open.
So, unless I'm mistaken, is this strategy telling us to get rid of the biggest fallers? Is this because they've already fallen so much that they're unlikely to continue??