Momentum Stock Screener: How to Find High-Momentum Penny Stocks in 2026

Missing a 50% move in a hot penny stock because you weren’t prepared is one of the fastest ways to learn the importance of using a momentum stock screener. Momentum screeners help traders focus on stocks that are already moving — not waiting around. In a fast-moving market filled with news catalysts, sector hype, and volatility, tools like these can be the difference between being ready to trade and being left behind.

You should read this article because it shows you exactly how to use a momentum stock screener to spot high-potential penny stocks before they make explosive short-term moves.

I’ll answer the following questions:

• What is the best momentum stock screener for beginners?
• Are there free momentum stock screeners that actually work?
• How do I find momentum stocks for day trading?
• Can momentum screeners help me avoid losing trades?
• What percentage gain should I look for in a momentum screener?
• How do I set up a momentum screener for penny stocks?
• Why is volume critical when screening for momentum stocks?
• What are the biggest mistakes traders make with momentum screeners?

Let’s get to the content!

How to Identify Momentum Stocks: Key Characteristics to Look For

The best momentum stocks share a few repeatable traits that show up before the biggest spikes. I’ve built my trading and teaching career by studying thousands of charts and watching how stocks behave before massive runs. These aren’t random moves. Momentum leaves tracks.

Check out my penny stock screener with the best stocks under $1!

Here’s a quick checklist to help spot high-momentum setups:

• Price increase of 15% or more in a short time frame
• Volume at least 2x the average daily volume
• Clear technical pattern like a breakout, gap-up, or morning spike
• Catalyst driving interest: company news, earnings, or hot sector
• Strong relative strength vs. the overall market or sector

Volume confirms interest, price movement shows demand, and chart patterns give clues for possible entries. But always remember, momentum is temporary. Don’t assume a fast mover will keep climbing forever. You need a plan to get in, get out, and protect your account.

How to Set Up Your Momentum Stock Screener (Step-by-Step)

If you want to trade momentum, you must use a platform that gives you real-time data — anything less puts you at a major disadvantage in a fast-moving market.

When it comes to trading platforms, StocksToTrade is first on my list. It’s a powerful day and swing trading platform with real-time data, dynamic charting, and a top-tier news scanner. I helped to design it, which means it has all the trading indicators, news sources, and stock screening capabilities that traders like me look for in a platform.

Grab your 14-day StocksToTrade trial today — it’s only $7!

Step 1: Choose Your Timeframe

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Start by picking the right timeframe based on your strategy. Day traders need to focus on what’s hot today — scanning for big percentage movers in the past hour or since the open. Swing traders should widen the lens and look at 5-day or weekly momentum.

If you’re unsure, use this simple breakdown:

• Want to be in and out the same day? Scan intraday momentum (5–30 minute chart)
• Looking for setups that play out over a few days? Use 3–5 day price change

Choosing the wrong timeframe will lead to chasing old plays or missing the window entirely. Over the years, I’ve seen too many students treat all momentum the same. It’s not. Timeframe tells you what kind of trader you are, and it should guide your setup from the start.

Step 2: Set Your Price Parameters

Focus your screener on stocks priced between $0.50 and $5.00. This range captures true penny stocks — the volatile, under-the-radar names that can offer the biggest percentage swings. Lower-priced stocks attract smaller accounts, and when enough traders pile in, the price can spike hard.

Price matters because different price levels bring different behaviors. Stocks under $1 trade differently than those around $3 or $4. By staying in a specific range, you build consistency in your screen results.

After two decades of studying price action in small companies, I’ve found the most explosive short-term gains usually happen in stocks between $1 and $3. That’s the sweet spot — enough volatility to move, but not so high that institutional funds slow down the action.

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Step 3: Filter by Volume

Volume is non-negotiable. Without it, you don’t have a trade. Set your minimum daily volume at 500,000 shares. Then add a relative volume filter — look for stocks trading at least 2 times their average volume.

Volume shows whether other traders are interested. No volume? No momentum. Just a dead ticker.

Low-float stocks that trade big volume are the best setups I’ve seen in my career. These stocks can go vertical when demand outpaces supply. But without enough trading activity, even the best chart or catalyst won’t matter. That’s why volume is one of the most important criteria in my 7-step framework.

Step 4: Add Momentum Indicators

Use simple, effective indicators that help you measure short-term momentum. Start with RSI — set your filter to show stocks with RSI above 60 to find strength. You can also add a price change filter: scan for stocks up 10–30% on the day.

Advanced traders can use MACD or ADX to check trend strength. But don’t overcomplicate it. Indicators are tools, not rules.

Momentum indicators help confirm that a stock is actually moving — not just showing random ticks. Over the years, I’ve learned to keep it simple: use a few indicators well, and focus on price action above all.

Step 5: Save and Schedule Your Scan

Once your screener is ready, save it and set alerts. Run your scans consistently — especially pre-market (8–9:30 a.m. ET), at the open (9:30–10:30 a.m.), and midday when trends reset.

Building a watchlist from your scan gives you focus. It keeps you from jumping between tickers and missing clean setups.

Set your screener to run on your trading platform or favorite scanner app. Alerts should be tied to your exact criteria: percent gain, volume spike, or news. I teach my students to treat scanning like brushing your teeth — it’s a habit, not a one-time event.

Why Momentum Matters for Penny Stock Traders

Momentum is what creates opportunity. In the world of penny stocks, a small piece of news or a sector trend can double a stock in hours. Without momentum, these setups are just names on a watchlist.

There are three reasons I focus on momentum in every lesson I teach:

1. Explosive moves happen fast — You don’t get time to “think it over.” If you aren’t prepared, you miss the trade.
2. Volume confirms the move — High momentum with volume tells you that real money is moving into the stock.
3. Better risk management — When momentum slows down, it’s often your exit signal. It helps time your trades.

But understand this:

Momentum always fades. It can last five minutes or five days, but it never lasts forever. If you chase late, you increase your risk. Learn to spot momentum early, build a plan, and stick to it.

Key Criteria to Screen for Momentum Stocks

Percentage Price Change

The most obvious sign of momentum is a rapid increase in price. Set your screener to look for stocks up at least 10–15% on the day. For swing trades, consider 20–40% over a few days.

Price movement shows demand. It tells you other traders are paying attention. This is where the momentum starts.

By focusing on stocks with big percentage gains, you cut through the noise. You’re not wasting time on laggards — you’re looking at the stocks that are already in motion. That’s where I’ve found my best short-term trades.

Volume and Relative Volume (RVOL)

Volume tells you how much interest there is in a trade. Relative volume (RVOL) compares today’s activity to the average — and that’s what really matters.

Set RVOL > 2 to find the best momentum names. These are the stocks breaking out of their normal range.

When I screen for momentum stocks, volume is often the deciding factor. I’ve watched thinly traded stocks spike and fade in seconds. Without volume, there’s no liquidity — and no exit if things go wrong.

Price Range Filters

Use price filters to stay in your wheelhouse. I recommend $0.50 to $5.00 for most penny stock traders. This range offers the most volatility without the dilution risk of sub-penny garbage.

By narrowing your price range, you get more focused results. You also avoid stocks that don’t fit your strategy.

In my early years, I traded too many different types of setups. Once I focused on a consistent price range, I found more patterns I could recognize and repeat. That consistency helps build real experience over time.

Market Cap Considerations

Market cap matters because it affects who’s trading the stock. Lower market cap companies — usually under $300 million — tend to attract retail traders and speculative money.

These are the names that move fast on small news.

Avoid larger-cap names when you’re scanning for high-momentum penny stocks. They don’t move the same way. Small-cap stocks are where I’ve seen the biggest intraday moves in my 20+ years of trading.

Technical Indicators for Momentum

Use technical indicators to support your price and volume analysis. RSI above 60 shows strength. MACD crossover may confirm a breakout. ADX above 20 can show a trend is building.

But don’t rely on indicators alone. Always combine them with chart patterns and catalyst awareness.

I’ve seen too many traders obsess over indicators and forget the basics. Indicators are secondary. Price and volume always come first. Use them as tools — not crutches.

Advanced Momentum Screening Strategies

The Gap-and-Go Strategy

The Gap-and-Go strategy looks for stocks that gap up in pre-market trading and hold their gains at the open. These stocks often continue higher if volume stays strong and a catalyst is in play.

Use your screener to find stocks up 10%+ pre-market with high volume and news.

This strategy has worked for me and many of my top students. It plays off emotional reactions to news — fear of missing out, panic buying, and momentum chasing. But timing is key. If the gap fades quickly, the move is over. Manage your risk tight.

The Breakout Momentum Screen

This screen looks for chart breakouts — especially above key resistance levels on strong volume. Combine technical filters (price near recent highs) with momentum indicators like RSI or MACD.

Breakouts are one of the core patterns I teach. They work best when supported by strong news or sector momentum.

The breakout screen helps you catch these moves early, while volume is just starting to surge. But never chase after the breakout is extended. You want to be early, or not in at all.

The Reverse Momentum Screen

This strategy finds stocks that were recent winners, but are now reversing hard. Look for big gainers that are now down 10–20% on increasing volume. These can become short setups or bounce plays.

Sometimes the best trades come after momentum dies — especially in pump-and-dump setups or overhyped crypto stocks.

The reverse momentum screen isn’t for beginners. It takes experience and chart reading skills. But for seasoned traders, it can offer great risk/reward when a momentum trend flips.

Sector-Based Momentum Screening

Scan by sector to find hot themes. Whether it’s bitcoin, blockchain, electric vehicles, or AI — momentum tends to move in waves.

If one company spikes, others in the same sector often follow.

Sector-based screening helps you catch sympathy plays. I’ve made many trades simply by noticing the second or third runner in a hot niche. It’s a powerful strategy — but don’t forget to check float, volume, and catalysts on each name individually.

Common Mistakes When Using Momentum Screeners

Chasing Already Extended Moves

One of the biggest mistakes I see is chasing a stock after it’s already up 50%+. The best trades happen early. If you’re late, the risk/reward flips against you.

Momentum screeners should help you find entries — not chase breakouts that are already done.

If you see a stock already up big, ask: is there still room to run? Or am I just hoping?

Ignoring Volume Confirmation

Price alone is never enough. If a stock is moving without volume, it’s likely a trap. That’s why I teach students to always confirm price action with strong volume.

Your screener should prioritize high relative volume. If the crowd isn’t in, you don’t want to be either.

Over-Relying on Screeners Without Chart Analysis

A screener gives you names — not trades. Don’t rely on it blindly. Always pull up the chart and study the pattern before making a decision.

Momentum fades. Traps are common. The chart tells the full story.

Not Adapting to Market Conditions

What works in one market might fail in another. In slow markets, momentum trades often fizzle. In hot markets, they can run all day.

You need to adapt your screener settings — and your expectations — to the market you’re in.

Neglecting News and Catalysts

Momentum without a reason is a red flag. If a stock is up big, always check the news. Was there a PR? Earnings? Sector move? Rumor?

News gives context. Without it, you’re just guessing.

Key Takeaways

• Use a momentum screener to find penny stocks with strong price action, volume, and a catalyst
• Stick to a repeatable process using price, volume, and simple technical filters
• Avoid chasing late moves — the best opportunities come early, with clear setups and planned exits

This is a market tailor-made for traders who are prepared. Fast moving stocks thrive on volatility, but it’s up to you to capitalize on it. Stick to your plan, manage your risk, and don’t let FOMO drive your decisions.

These opportunities are fast and unpredictable, but with the right strategy, you can make them work for you.

If you want to know what I’m looking for — check out my free webinar here!

Frequently Asked Questions (FAQs)

How can momentum stocks impact my portfolio performance?

Momentum stocks can create fast gains that improve short-term portfolio performance, especially for active traders who manage risk tightly. However, their high volatility means they can also hurt your account if you don’t follow a disciplined strategy. Treat them as tools for trading, not long-term vehicles for investors.

Are momentum stocks a good investment for long-term growth?

Momentum stocks are typically not suited for long-term investment or consistent growth because they often spike and fade quickly. Most of these companies lack strong financials or proven business models. If you’re focused on long-term performance, you may want to look at more stable assets with real fundamentals.

When is the right time to sell a momentum trade?

The best time to sell is when the price action slows down, volume fades, or your setup breaks — not when emotions take over. Selling based on clear rules protects your financial account from large losses and gives you more control over your assets. A fast spike can reverse just as quickly, so stay alert.

What kind of information should I track for each trade?

You should log detailed information about the chart setup, volume, catalyst, execution, and your reasoning behind the trade. This helps you review past transactions and find patterns in your performance. Over time, the right data gives you a serious edge in the market.

Can I use momentum strategies in different countries or on different exchanges?

Yes, momentum trading works across multiple countries and exchanges, but you need to adjust for things like liquidity, currency risk, and trading hours. Stocks, crypto, and even small-cap names outside the U.S. can show explosive momentum. Make sure your platform supports real-time market data and global filters.

Do momentum screeners work for cryptocurrency like Ethereum or alt coins?

Yes, momentum screeners can be used on cryptocurrencies like Ethereum, especially when coins spike on news or high user activity. Just remember the fees, security issues, and technology risk are different compared to stocks. Cryptocurrencies trade 24/7, so timing and alerts are even more important for traders.

What should users know about fees, rights, and payments when using trading platforms?

Users need to understand how platforms charge fees — including spreads, commissions, and withdrawal costs — as they directly affect trade outcomes. You should also read the fine print around account rights, especially when using apps or brokers that offer limited transparency. Delays in payments or unclear rules can impact your ability to react quickly in fast markets.

How do products, business models, and content trends affect momentum setups?

Momentum often starts when new products launch, a business reports earnings, or content goes viral and creates buzz. Traders react quickly to headlines, and sharp moves can come from small companies riding short-term hype. These spikes don’t last long, but they can offer real opportunity if you’re ready.

What role does market data play in setting up a momentum trade?

Accurate market data — including real-time volume, price movement, and bid/ask spreads — is critical for timing your entries and exits. Without it, you’re guessing instead of making informed decisions. The more precise the data, the better your odds of managing the amount of risk in each trade.

Can you give an example of how a low-float stock created a fast momentum spike?

An example would be a biotech company announcing FDA approval, causing the stock to spike 100%+ within minutes due to low float and high demand. Traders watching for catalysts and using the right screeners were able to catch the move. This shows how quickly momentum can build when conditions align.