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How to Customize the ThinkOrSwim PreMarket Gap Scanner’s Parameters

 

Premarket Gap Scanner for ThinkOrSwim:
http://thinkorswim.net/product/premarket-gap-scanners-for-thinkorswim/

This video shows how to customize the volume, average volume, price ranges, and average true range / ATR parameters for my Pre-market Gap Scanner package for ThinkOrSwim.

Every trader is different, and we each focus on different types of stocks. Maybe you like playing opening drive momentum trades on low-float stocks early in the morning. Maybe you’re looking to play the first pullback on a trend day. Or maybe you’re looking for 1-2-3 patterns on 2 and 5 minute charts.

All of these plays might require different volume, average daily volume, and average true range requirements when you’re scanning for gaps in the pre-market. So this video will walk you through how to change and customize those settings in ThinkOrSwim, without having to do any coding in Thinkscript.

Find out more and purchase the scanner at this link:
http://thinkorswim.net/product/premarket-gap-scanners-for-thinkorswim/

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Scanning for Gaps in the Pre-Market with ThinkOrSwim

 

ThinkOrSwim’s built-in scans don’t allow you to scan for gaps in the pre-market, they only work after the open. Because of this, most traders are forced to pay huge monthly fees for premium scanners like Trade-Ideas or Pristine’s ESP scanner. So I developed these custom scans using TOS ThinkScript to help find the best stocks forming gaps in the premarket, using the free market data and scanning tools in the ThinkOrSwim platform.

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Gap Trading Strategy: Mean Reversion Gaps in ThinkOrSwim

mean reversion gaps by adrian manz

Adrian Manz’s Gap Trading Strategy for ThinkOrSwim

This is a mean reversion gap trading strategy that is promoted by Dr. Adrian Manz of Trader Insight (see an example video by Manz here: https://www.youtube.com/watch?v=oudRj-Vcv0Q). A client of mine was interested in developing some tools to trade this strategy on ThinkOrSwim, and so I was able to work on this project and get several tools created to make it really easy. After looking into it more, I found the strategy to be pretty intriguing and very different from how I’ve traded gaps in the past, so I thought it might be worth my readers’ time to take a look at it. This is a complete set, which includes the strategy script itself, along with a custom scanner to find the gaps each day, and indicators and columns to help sort and evaluate the gaps.

What It Is

  1. Scanner: helps you find stocks that are gapping way outside their normal bounds, increasing the probability of an immediate mean reversion move that you can fade.
  2. Watchlist columns: these help you sort through and quickly analyze the best gap trading strategy candidates that are likely to have an immediate mean reversion.
  3. Indicator: helps you find past and current entries on the chart and study how individual stocks perform and respond to this kind of gap trading strategy.
  4. Strategy: Plots entries, exits, and (optionally) stops, on the chart (intraday charts only). The setups are based on the daily chart according to Adrian Manz’s rules, but the actual entries are done on whatever intraday timeframe you prefer to trade. The entry system is my own implementation of the gap trading strategy, which is to enter on the first intraday bar that is outside the standard deviation boundary and also outside of VWAP, and then it takes target once the price retreats back to VWAP. You can use this particular strategy if you like, or manage the trades on your own however you prefer. Adrian Manz uses a more price-action-based entry where he enters on a bar break in the direction of the fade, and takes targets based on support and resistance levels. However, S&R is very hard to code accurately, and I wanted to at least include one mechanical way of implementing the system, so the VWAP target makes sense on a mean reversion strategy like this. And this method seems to work well in my own tests.

Why You Want It

Trading is a game of probability and risk management. This strategy specifically addresses the probability issue, because there is always a reversion to the mean… statistically it’s just going to happen. This strategy helps you find the extreme conditions that are even more likely to result in an immediate mean reversion move.

How It Works

The scanner finds any stocks that meet the trading strategy’s criteria for being likely mean reversion candidates, and then the custom quote watchlist columns help you sort through them quickly and review the charts to see which ones you want to take a position on.

The indicator package helps you visually see previous setups that happened on your charts, as well as today’s signal, by plotting the unique standard deviation lines and signal arrows whenever an entry condition is triggered.

 


$99.99 $49.99Add to cart

 

 

Adrian Manz's Gap Trading Strategy for ThinkOrSwim
Adrian Manz’s Gap Trading Strategy for ThinkOrSwim
Adrian Manz's Gap Trading Strategy for ThinkOrSwim
Adrian Manz’s Gap Trading Strategy for ThinkOrSwim

$99.99 $49.99Add to cart