Finding the right stocks to trade is half the battle in day trading. Pre-market scanning helps you identify stocks with the highest potential for movement before the market opens. This guide teaches you how to build effective scans that consistently find profitable opportunities.
Why Pre-Market Scanning Matters
Thousands of stocks trade every day, but only a handful offer high-probability setups. Pre-market scanning filters out the noise and focuses your attention on stocks with catalysts, volume, and volatility. Without a scanner, you are left guessing which stocks to watch.
The 80/20 rule: About 20% of stocks provide 80% of day trading opportunities. Your job is to find those stocks before the market opens.
Essential Pre-Market Scan Types
1. Gap Scanner
The gap scanner identifies stocks trading significantly higher or lower than yesterday's close in pre-market:
Gap Up Scanner Settings
- Gap percentage: 4% or higher from previous close
- Pre-market volume: 100,000+ shares
- Price range: $5 - $200 (your preference)
- Average daily volume: 500,000+ shares
Gap Down Scanner Settings
- Gap percentage: -4% or lower from previous close
- Pre-market volume: 100,000+ shares
- Price range: $5 - $200
- Average daily volume: 500,000+ shares
Gap Scanner Results Example
At 8:00 AM, your gap scanner shows:
- AAPL: +6.2% on strong earnings
- MRNA: -8.5% on clinical trial results
- GME: +12% on social media buzz
- TSLA: +4.5% on delivery numbers
These are your potential plays for the day.
2. Volume Scanner
Volume indicates interest. Stocks with unusual pre-market volume often see significant moves at the open:
- Relative volume: 200% or higher of normal pre-market volume
- Pre-market shares traded: 500,000+ shares
- Price change: 2% or more in either direction
3. News Scanner
Catalysts drive moves. Scan for stocks with fresh news:
- Earnings releases (beats or misses)
- Analyst upgrades/downgrades
- FDA approvals or denials
- Merger and acquisition announcements
- Management changes
- Product launches
Building Your Scanning Process
Step 1: Run Initial Scans (7:00 AM)
Run your gap and volume scanners to get a broad list of potential plays. You might have 20-30 stocks at this point.
Step 2: Filter by Catalyst (7:30 AM)
Research each stock to understand why it is gapping or showing volume. Remove stocks without clear catalysts.
Step 3: Analyze Charts (8:00 AM)
For remaining stocks, check the charts for:
- Key support and resistance levels
- Overall trend (daily chart)
- Pre-market price action patterns
Step 4: Build Final Watchlist (8:30 AM)
Narrow to 3-5 stocks with the best combination of catalyst, volume, and technical setup.
Quality over quantity: Five well-researched stocks are better than twenty stocks you barely know. Deep knowledge of a few stocks beats shallow knowledge of many.
Pre-Market Volume Analysis
Not all pre-market volume is created equal. Learn to read what volume tells you:
Healthy Volume Characteristics
- Steady accumulation throughout pre-market
- Volume increasing as price approaches key levels
- Tight bid-ask spreads
- Multiple prints at consistent prices
Warning Signs in Volume
- Single large block trade with no follow-through
- Volume dying off before the open
- Wide, erratic bid-ask spreads
- Price swinging wildly on small trades
Volume Analysis Example
Stock A and Stock B both have 500,000 pre-market shares traded:
Stock A: Steady buying from 7 AM to 9 AM, tight spread, consistent prints
Stock B: One 400,000 share block at 7:15 AM, then quiet
Stock A is the better trade. The sustained interest suggests follow-through at the open.
Filtering Criteria for Quality Stocks
Apply these filters to improve the quality of your scan results:
Minimum Criteria
- Price: Above $5 to avoid penny stock volatility
- Average volume: 500,000+ daily shares for liquidity
- Float: Consider float relative to volume (low float = more volatile)
- Spread: Tight bid-ask spread (under $0.10 for most stocks)
Advanced Filters
- Relative strength: Stock outperforming sector and market
- Float rotation: Volume exceeding float indicates extreme interest
- Historical gaps: How does this stock typically trade after gaps?
Common Scanning Mistakes
Avoid these errors that reduce scan effectiveness:
- Too many criteria: Overly complex scans filter out good stocks
- Ignoring catalysts: Volume without a reason rarely sustains
- Chasing small gaps: 2% gaps often fill and go nowhere
- No research: Trading scan results without understanding why
- Static settings: Not adjusting for market conditions
Scanner Settings by Market Condition
Trending Markets
- Focus on gap ups in strong sectors
- Lower gap threshold (3%+)
- Look for stocks breaking to new highs
Choppy Markets
- Higher gap threshold (5%+) for clearer catalysts
- Emphasize volume more than gap size
- Look for stocks with independent catalysts (earnings, news)
Bear Markets
- Add gap down scanner to find short opportunities
- Focus on relative weakness
- Be selective; fewer quality setups exist
Tools for Pre-Market Scanning
Several platforms offer pre-market scanning capabilities:
- Finviz: Free basic scanner, good for starting out
- Trade Ideas: Advanced real-time scanning
- ThinkorSwim: Free with TD Ameritrade account
- Benzinga Pro: Excellent for news-based scanning
- StockCharts: Technical scan capabilities
Track Your Scanner Results
Pro Trader Dashboard helps you analyze which types of scans produce your best trades. See win rates by gap size, volume characteristics, and catalyst type to optimize your scanning process.
Summary
Pre-market scanning is essential for finding tradeable stocks before the market opens. Use gap scanners, volume scanners, and news scanners to identify stocks with catalysts and momentum. Filter results by price, volume, and spread to ensure quality. Research every stock to understand the catalyst. Build a focused watchlist of 3-5 stocks with clear trade plans. Adjust your scanner settings based on market conditions.
Integrate your scanning into a complete morning trading routine or learn about pre-market trading strategies.