Could anyone provide their screening criteria for trading small-cap stocks at market opening?

To identify effective screening criteria for trading small-cap stocks at the open, you need to consider several key factors and metrics that reflect market activity and potential price movement. Here’s a detailed guideline you can follow:
Market Capitalization: Define your parameters for “low cap,” typically under $2 billion. This ensures you are targeting companies with smaller market caps, often more volatile and with potentially larger price swings.
Pre-market Volume: High pre-market trading volume can be indicative of significant interest or impending movement. Set a minimum volume threshold that aligns with your trading strategy. For small-cap stocks, you might target those with pre-market volume significantly higher than their average daily volume.
Price Movement: Look for stocks showing significant price changes in the pre-market. This might involve setting a percentage change threshold, such as looking for stocks that have moved up or down by more than 5%.
Catalysts: Identify any news or events that could serve as catalysts for opening price action. This might include earnings reports, product launches, industry news, or macroeconomic data releases.
Volatility Indicators: Use technical volatility indicators like Average True Range (ATR) or Bollinger Bands to assess whether a stock is primed for a breakout.
Bid-Ask Spread: Check for narrow bid-ask spreads which suggest more liquidity and potentially less slippage on trades.
Chart Patterns: Look for technical patterns that often accompany strong moves, such as breakouts from consolidation, strong candlestick formations, or trend direction as defined by moving averages.
Support and Resistance Levels: Identify key support and resistance levels that could act as pivot points during the early trading hours.
Insider and Institutional Activity: Monitor insider buying/selling activity or institutional investments which can influence small-cap stocks significantly.
Risk Management: Set clear stop-loss and take-profit levels to manage risk, especially crucial with the more volatile nature of small-cap stocks.

By including these criteria in your trade scanning process, you will better position yourself to capitalize on early trading opportunities in small-cap stocks. Remember that this strategy needs to be tested and tailored to fit your specific trading style and risk tolerance.