Table of Contents
Have you ever wondered how many stocks are listed in the Indian stock market? You will be astonished to hear that there are 6000+ listed companies combining both the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE)
Now, if you are an investor or a trader, how will you identify stocks for your portfolio? Will you read the financial statements or analyze the price charts for 6000+ stocks? That would be a nightmare for a beginner and would simply make no sense even if you are a pro in the stock market.
At StockEdge, we always strive to empower the retail investor in the stock market. Therefore, we have developed a powerful stock screening tool through which you can scan stocks based on the following category of parameters such as:
List of StockEdge Scans
You will find the scanning tools under the Premium analytics section of StockEdge named “Scans.” Just click on Scans to get the list of different categories of scans, as shown in the screenshots below:
Now, if you are an investor, stock trader or equity derivatives trader, you can use Scans from our various categories which suit your personal trading or investing style. With StockEdge Scans, identify the right stocks at the right time so that you don’t miss any opportunity in the stock market.
In this blog, we will explore all the categories of scans and highlight some of the best scans in each category to illustrate with real-life examples. So, without any further ado, let’s begin with the first category of scan, which is the “Price Scans.”
Price Scans
You may be familiar with a common phrase, “Bhav Bhagwan hai”, meaning Price is supreme in the market, and every other thing follows the price. Hence, screening the stocks based on price movement could be the best way to identify stocks, especially if you are a trader.
Under Price scans, you will find an extensive list of scans such as breakout scans, price behavioral scans, scans based on the relative strength of a stock, etc. (as shown in the image below)
If you are a short-term trader, you may find breakout scans to be very helpful. Generally, when a stock breaks above the previous day’s high or the previous week’s or month’s high, it is considered to be a strong stock, right? Now, with the help of this scan, you can easily identify strong stocks for your trade.
Weekly Breakout Scans
Let’s take an example of weekly breakout scans, under which you will find multiple scans (as shown in the image below)
Here, you can scan for both bullish and bearish stocks, such as:
Close Crossing last week’s high– When the stock gives a daily closing above the previous week’s high, it is a bullish signal. Stocks that have fulfilled this criteria will appear under this scan. Click on it to see the list of stocks.
As you can see in the above image, here is the list of major stocks that have fulfilled the criteria; you can also download the list in a CSV file for further analysis. By default, it shows major stocks (Composite basket of Nifty 500 and S&P 500 Stocks), but you can easily filter stocks if you wish to see stocks only from Nifty 50 or only F&O Stocks. The list is updated at the end of the day. However, if you wish to see back-dated data, you can easily check the past 7 days’ scan results.
Going forward with the example, the stock of BirlaSoft Ltd. appeared on the scan on 5th Oct. Let’s get to the price chart now!
The above image is the daily chart of BSOFT. The blue arrow marked the candle of 5th Oct, and since then, the stock price has increased almost 6% in 4 days.
The next price scan is “Close Crossing Last week’s Low”, which is a bearish signal as the stock price has given a daily closing below the previous week’s low.
In a similar way, you can explore other weekly breakout scans or in other time frames like daily, weekly, monthly and yearly.
Price Behavior Scans
We move to the next set of price scans based on the 1-day, 2-day and 3-day price behavior of a stock. Let’s check out 3 days’ price behavior scans to find out how to identify strong stocks.
Exploring 3 days’ price behavior scans, you can find both bullish and bearish trades as per the selected scan. Let’s select higher highs for 3 days.
Let’s take a look at the chart of PCBL Ltd. and how the stock price has changed after it appeared on the list on 5th Oct.
As you can see in the above chart, the stock has sharply moved 10% after making higher highs for the past 3 days (marked in red arrows).
Relative Strength Scans
We move to the next set of price scans based on the relative strength of a stock, commonly known as RS.
If you are not aware of what’s relative strength or RS? This is basically a comparative analysis of a stock compared to its benchmark (it can be the Nifty 50 index or sectoral index).
However, ideally, our scans are developed keeping in mind the benchmark index of the Indian stock market, which is Nifty 50. Therefore, if the stock has positive RS, it is considered bullish, meaning the stock is outperforming the benchmark, whereas if the stock has negative RS, it is considered bearish, meaning the stock is underperforming the benchmark.
Let’s explore RS (55) scans. This basically identifies stocks that have outperformed the benchmark or the sector in the past 55 days. There are various scans listed under it (as shown in the screenshot below), and find out the list of stocks that have just started to outperform the benchmark index with RS (55) going above 0.
On 3rd Oct, PAYTM appeared in the screener (RS 55 turned positive). Let’s see the price chart of PAYTM and how it has performed since then.
As you can see in the above image, the stock has surged 10-12% after its RS 55 moved above 0.
Hope you have understood the importance of Price in the stock market and how useful are the different types of price scans while trading. However, please note that all these scans are updated at the end of the day (EOD), and based on that, you will be able to make an informed decision on the next trading day.
Also, while screening the stocks, if you wish to analyze further, simply click on the stock name; you will able to see its chart, its financials, shareholding patterns and more by scrolling the tab (as highlighted in the screenshot)
Volume & Delivery Scans
Volume refers to the number of shares of a particular stock that are traded during a specific period, typically a trading day. It is a measure of the level of activity and liquidity in the market for that stock.
On the other hand, Stock delivery involves transferring the ownership of shares from the seller to the buyer. For example, if you bought 100 shares of ITC Ltd. and you did not sell 100 shares on the same day, that means you are carrying your long position in the stock overnight. It means you have taken delivery of the shares, and it will be reflected in your demat holding under your portfolio.
Both volume and delivery are considered the second most important thing after price while analyzing the charts. Any price move combined with high volume or higher-than-average delivery adds more credibility to its price trend.
Under this category of scan, basically, you can identify stocks that have witnessed high traded quantity, high delivery quantity, higher delivery percentage or a combination of both (High Trade and Delivery Quantity or Percentage)
- High Trade Quantity or High Delivery is considered when it is greater than 1.5x the average quantity or the average delivery quantity, as the case may be for the last 5 days. This signifies higher interest in that stock by the market participants.
- Delivery percentage is the delivered quantity of a stock expressed as a percentage of a traded quantity. It is considered to be high when it is greater than or equivalent to 75%.
You can run these scans on three different time frames: daily, weekly or monthly. (as shown below)
Selecting Volume and Delivery scans, you will have a list of individual scans, such as high traded quantity, which is essentially the volume of the stock. Also, you can stocks that have high delivery volume both in terms of quantity and as a percentage of volume.
Let’s scan the stocks which have High Delivery Quantity and Percentage:
Let’s check out the chart of Eureka Forbes Ltd and how the share price reacted the next day!
As you can see in the above image, on 12th Oct, there was a rise in price and a sudden spike in Volume on the daily chart. The next day itself, the share price jumped 5%
Technical Scans
This is by far the most useful and important category of scans if you are a trader in the stock market. We have developed technical indicator-based powerful scans for you so that you take entry and exit stocks at the right time and at the right pierce level. This is essentially a “trader’s paradise.”
We have a whole list of scans based on technical indicators, starting from basic Simple or Exponential Moving averages to highly advanced Ichimoku cloud scans. (see the image below for the entire list of indicator-based technical scans!
If you use SMA or EMA in your trading set-up, or you wish to learn trading strategies based on SMA or MACD, then you can read this blog: Top 3 Swing Trading Strategies for beginners.
To give you an example of how you can use these scans for identifying stocks for trading, let’s explore the Relative Strength Index (RSI) Scan to find stocks!
Here is the list of scans that you will find under RSI Scanner; based on your trading style, you can find stocks that meet your criteria. For instance, generally, the RSI crossing above 50 is considered to be a signal for bullish momentum. Let’s take a look at those stocks that have just crossed RSI > 50 on daily charts.
As you can see, the first stock in the list which appeared on 6th Oct was Bosch Ltd. Now, let’s move to the daily price chart of the stock and how it performed since then.
As you can see, after RSI crossed 50, the share price increased by almost 7% in 4 days.
Similarly, you can explore other RSI scans and other technical scans based on your parameters to identify stocks for your trading.
But what if you hold your trading position for a long term, then analyzing weekly price charts along with technical indicators are essential. So, with the latest version of StockEdge 11.5, we have introduced weekly scans on RSI, Super trend and Parabolic SAR.
Going forward with RSI, in the below image you can see all scans for RSI which were on daily time frame can now be found in weekly time frame as well. Additionally, you can also view the number of stocks which are fulfilling the criteria for a particular scan. (this is applicable to both daily and weekly scans).
Similarly, you can get the weekly scans for Super trend indicator and Parabolic SAR.
Fundamental Scans
The next set of scans is developed for investors in the stock market. If you are an investor in the market, this market screener is one of the best ways to identify strong fundamental stocks. As we all know, understanding the company’s fundamentals and analyzing its balance sheet, cash flow statements, and income statements is a time-consuming process, and it may happen that you can miss lucrative opportunities in the market.
Therefore, fundamental analysis, with the help of StockEdge, essentially helps you to save time and focus on companies that are worth your time and money.
Please note these scans are updated as when the quarterly or annual results are announced by the companies.
Under the fundamental scans, you will find multiple scans based on profitability, valuation, solvency, efficiency and even corporate activity scans and much more. (as shown in the image below)
Also, under each type of fundamental scan, you will find a plethora of scans for your fundamental analysis.
So, without further ado, let’s jump into profitability scans and find out what different parameters you get to screen profitable companies to invest in.
As you can see, there is a vast library of scans available based on the portability of a company. Suppose you want to find such companies whose EPS (earnings per share) has been increasing QoQ.
This particular scan, which is Consistently Increasing Quarterly EPS, gives us the list of companies that have positive EPS for the past five quarters, and it is also increasing every quarter as compared to the previous quarter.
Now, if you are wondering what exactly is the EPS of a company and what increasing EPS signifies? Here is a brief explanation:
Earnings Per Share (EPS) is a financial measure that signifies the division of a company’s earnings among each outstanding common stock share.
Consistently increasing EPS QoQ (Quarter-over-Quarter) is significant because it indicates improving profitability and financial health, attracting investors and potentially driving stock price growth.
Now let’s take a look at the price action move made by Lupin Ltd., which is the first company on our list.
As you can see, the spectacular move in the stock price of Lupin Ltd. The stock price has surged almost 80% from April 23 to October 23.
You may have your own set of fundamental parameters, which you can explore from our vast library of fundamental scans from StockEdge.
Futures & Options Scans
Futures and options are highly active in the Indian stock market, with the National Stock Exchange (NSE) standing as the world’s largest derivatives exchange. India’s derivatives market has experienced robust expansion in recent years.
Trading in stock futures and options offers several advantages. In simple terms, they allow investors to speculate on the future price of a stock without owning the stock itself. Futures provide a way to profit from both rising and falling markets, meaning that you even short-sell stock futures, which you cannot do with cash stock, giving you the flexibility to earn profits in different market scenarios.
Also, while dealing in futures and options, they are used to hedge against price fluctuations, amplify potential gains, and require a smaller upfront investment compared to buying stocks outright.
We have developed scans based on futures open interest data, which is very crucial to analyze if you are trading in futures and options. (as shown in the image below)
Open interest in stock futures represents the total number of outstanding, unclosed contracts in the market.
An increase in open interest indicates that new positions are being created, suggesting growing interest and participation in that specific futures contract. It can be a sign of bullishness if accompanied by rising prices. Conversely, a decrease in open interest suggests that positions are being closed, potentially signaling a lack of enthusiasm in the market or traders exiting their positions.
If you closely monitor these changes in open interest, it can provide valuable insights into the strength and direction of the trend in a stock.
Let’s try to scan the list of stocks with New Longs in futures contracts, meaning the stock price has increased along with a rise in cumulative open interest, which is generally considered a bullish signal.
You will find new long scans in stock futures under the sub-category “Future Long Position Scans.”
Going forward with the example of City Union Bank (CUB) that appeared on New Long Scan on 6th Oct. By clicking on any stock, you can also see the historical trend in open interest, OI analysis (whether New long, New shorts have taken place in earlier dates) and Option chain data as well. (as you see in the below screenshots)
Now, let’s jump into the daily price chart of CUB Ltd. to find out how the stock price has reacted after it appeared on the New Long scan on 6th Oct.
As you can see in the above price chart, the stock price jumped almost 12% after a short pull-back the next day. Therefore, it is very important that while you are dealing in the futures and options, you must set a defined risk-reward ratio so that you hold on to the trade, even if the stock doesn’t react immediately the next day.
You can not only identify stocks for taking a long position but also identify bearish stocks with the help of numerous other scans under Future Short Position Scans.
Additionally, identifying High or Low PCR (Put-Call Ratio) stocks has become easy as we have developed several PCR scans (as shown in the screenshot below)
Strike Wise Option Scans
We have another set of F&O scans, which are strike-wise option scans. When you are dealing with only options, choosing the right strike is crucial. Be it Index Options or Stock Options. In StockEdge, you will be able to identify the correct strike to trade. In this set of scans, you will be able to identify strikes with a high increase or decrease in open interest for both Calls and Puts. This will help you to identify resistance and support levels as well as the trend for any index or stocks.
How? Let’s find out!
In general, the market anticipates an increase in open interest as (an addition of open interest by the option writers/option sellers) So, when you scan the increase in Call OI for stocks or index, that strike is considered as a resistance level, and vice versa for Puts is considered as support level.
On the other hand, when you scan for the decrease in open interest, it indicates that option writers are unwinding their positions; hence, you can expect a price movement based on call or put. For instance, if there is a decrease in call OI, it is considered a bullish signal, whereas a decrease in Put OI is considered a bearish signal.
Based on the same logic, let’s identify a bullish signal in stocks using the scan “Stock Strikes with a decrease in Call Open interest.”
As you can see, the strike of ATM and near OTM strikes of MCX have witnessed high unwinding of Call OI, which indicates a bullish signal in the stock. Let’s go straight into the price chart of MCX to see how the price reacted after that day.
Look how the price surged that day itself; the stock price jumped nearly 5%, and after taking a short pause, MCX surged nearly 8%.
However, it is always advisable to consider analyzing the stock’s primary trend, volume, and other technical indicators before initiating any trade. These scans are helpful in identifying trading opportunities, but you must do your own research and due diligence before taking a trade in futures and options.
Lastly, we have Candlestick scans in StockEdge; let’s explore that:
Candlestick Scans
Candlesticks are basically graphical representations of the price movements of stocks. A candle consists of (open, high, low and close) prices of a stock for a specific time period (minutes to days, weeks, or months). A single or a combination of two or more candles forms patterns that can provide valuable insights into the trend of the stock and potential price reversals, which helps you make informed decisions about buying or selling stocks at the correct price and at the right time.
There are more than 35+ candlestick patterns, and we have managed to develop popular candlestick scans that can help you screen stocks that have made any type of candlestick patterns on daily charts. We have a bunch of categories of candlestick patterns (as shown below)
We will be exploring candlestick reversal scans as they signal potential shifts in the sentiment, indicating a change in the current trend. This may help you identify ideal entry and exit points, thus reducing your risks and maximizing profits.
Let’s take the example of Dark Cloud Cover, which is essentially a bearish reversal candlestick pattern.
As you can see, Dark Cloud Cover has formed on the stock of MapMyIndia and appeared on the list on the 6th of Oct. This candlestick pattern is usually seen at the end of an upward trend as it indicates a potential reversal of the trend.
Now, let us jump into the price chart to find out whether the trend of the stock has changed or not.
In the above daily price chart of MayMyIndia, you can see the trend of the stock was up trend, but after the formation of the candlestick pattern of Dark Cloud Cover, the stock price dropped by nearly 9%.
You can explore other scans on candlesticks, which will essentially help you to make an informed decision while trading in stocks. However, screening stocks based on a single parameter may not be ideal for some.
Therefore, we have created a section called “Combination Scans” where you can add your multiple scans from different categories and subcategories as per your specified criteria.
Combination Scans
A combination Scan or Combo Scan gives you an edge to identify stocks not only by a single parameter but also by a number of different criteria for selecting stocks. So, how do you create your own combination scans? Follow these steps:
- Go to My StockEdge
- Click on “My Combo Scan”, which you will find under “My Data.”
- To add a combination scan, click on the + button in the top right corner
- Give a name to your combo scan and click Add.
- Click on Add Scans and start adding your favorite scans.
For example, here is a techno-funda scan named FIPA (Financial Improvement with Price action), created by Mr. Vivek Bajaj
Start using StockEdge scans and create your own combination scans to screen stocks for trading or investing.
The Bottom Line
In conclusion, using StockEdge scans is a powerful way to optimize your stock selection process for both trading and investing. These scans provide a systematic and data-driven approach to filter and screen stocks based on specific criteria. By leveraging the extensive capabilities of StockEdge, you can uncover potential opportunities, reduce risks, and enhance decision-making skills in the stock market. Whether you’re looking for short-term trades or long-term investments, the ability to customize scans and focus on relevant data can greatly improve your stock selection strategy.
Remember that successful stock selection is a crucial component of success in the stock market, and StockEdge scans can be a valuable ally in this pursuit.
