sector rotation analysis

commtrd

Looking at sector ETFs each evening, then I want to drill down into the stocks that are in that sector. For example: I see energy (XLF) has been relatively stronger lately, so I want to look at the stocks in that sector. Are there lists of sector categorized stocks available to aid in quickly isolating trade ideas? Also that could be imported into a scan to segregate out the stocks to trade by whatever criteria such as coming out of a basing formation, pullback to a MA, float, or whatever? This capability would be incredibly useful as a very necessary time saving tool.

markd

On the advanced scan workbench, look at the drop down for "Sectors and Indexes".

Select the sector you want - e.g. "FINANCIAL SECTOR" by clicking on it to highlight, then click on the "Add" button.

The line

and [group is FinancialSector]

will be added to the last line of your scan (you may have to scroll down to see it).

Cut and paste it to the top of your scan.

With no other conditions set, this line alone will return 999 symbols, which is the limit the scan engine will return. But, alot of those symbols will be untradable junk. So, you need to add some conditions of your choice. For instance

and [group is FinancialSector]
and [ [exchange is NYSE] or [exchange is NASDAQ] ]
and [market cap > 1000]

That picks up stock with market cap over a billion trading on the named exchanges and it gets around 540 hits (it will vary as stocks rise or fall in market cap at the limit).

The financial sector has a lot of stocks, mostly small banks, which is why the market cap limit is high.

For other sectors, >100 (million) works well.

You can also select just particular industries within a sector - for instance [group is Software] in Technology, or [group is Biotechnology] in Health Care.

Once you have the universe of stocks you want to deal with, you can concentrate on designing set up conditions, like MACD crossovers, Stochastic crossovers, or whatever you prefer.

You can get ideas for that, including borrowing from predefined scans, by following the links on this page:

http://stockcharts.com/school/doku.php?id=chart_school:scan_library