Momentum Stocks

Momentum stocks can be a game-changer for you if you want to make your trading journey smooth. These stocks are usually experiencing a quick increase in price and often outperform the larger market. You will find these companies having strong trading volume, positive earnings reports with high analyst ratings. Today, we will discuss more about these stocks and understand how to identify these stocks along with other crucial information. Firstly, there are several factors that decide whether the stock comes under momentum category or not. A visual analysis of a stock’s price chart can reveal the patterns that indicate momentum. Technical indicators like moving averages, relative strength index and convergence divergence can easily provide a signal about a stock’s momentum. When it comes to risk and considerations, undoubtedly momentum stocks can be profitable but come with risks such as overvaluation, market corrections and mean reversion. Let’s understand in detail. As we know, momentum trends are not always sustainable over the time the price of any stock may revert to its mean value.  Momentum can lead to overvaluation where the stock’s price becomes detached from its core fundamentals. In a market correction or downturn, momentum stocks can be particularly vulnerable to selling pressure. Finding good momentum stocks is always challenging and needs in-depth market research. But don’t worry FindScan is there to help you. This advanced screener allows users to set all required attributes like market valuation, P/E ratio, RSI, and MACD and provide best screened stocks list to users. The simple and useful features of this screener make it suitable for both seasoned and newbie traders. Try FindScan today and experience its amazing features and add some of the potential stocks to your portfolio.