I have been trading for over 15 years. There are very few things I can recall from a technology perspective that have both made trading easier for me and increased my ability to generate P&L on a daily basis. About two years ago one of our traders approached me with real time “lists” that he was generating using TradeStation. Many of the stocks on the lists were In Play names that SMB was trading each day. He began to work with another trader on our desk on improving those lists with a series of algorithms that would capture not only the most in play names each day but also stocks that were exhibiting specific technical patterns.

When they completed the project and showed me the lists that were being generated by the algorithms I was overwhelmed. They had created a tool that quickly and efficiently ranked all of the stocks in SMB’s trading universe. It was a tool that I could sit down and use to make money immediately. I shared it with a few of my friends at other firms who were experienced traders. They had the same reaction that I did. They loved it. The simplicity. The elegance. No need to spend hours programming and tweaking to make sure your filters were generating useful trading information.

We took our algorithms and created an amazing user interface based on HTML 5. We named the tool the SMB Radar because it lists all the stocks that active traders should be watching intraday for potential trades. It also has a scan that spots unusual trading activity before our live newsfeed alerts us to such activity!

Here is one way that I have found that the Radar spots easy money setups for me. If the market is trending lower intraday on a 15-minute time frame I will scroll down the “weak today” list at 10:30AM. I will usually find at least 3-4 names in the top 10 names that are setting up perfectly as shorts. Stocks that have had large down moves on the Open and have either retraced already so they have very clearly defined risk, or stocks simply consolidating right above the LOD. These are trades were I can risk pennies to potentially make dollars.

Let’s take a look at the list from Friday June 24, the last day that the market was in an intraday downtrend. Each stock on the list is assigned a number to rank how weak the price action is for that day. It also has a color coding to let us know how In Play the stock is.

Here are a few charts from the above list with five-minute bars. I have highlighted consolidation areas on each chart. These areas allow me to very clearly define my risk prior to entering a trade. Some of the charts also extend to the prior afternoon’s trading range to demonstrate when the prior day’s support area is breached this may lead to a significant down move.

I wish a tool like this existed earlier in my career. It makes the process of finding the best setups intraday so much easier.