The MomentumDetector scanner is designed to work seamlessly with any trading software platform you prefer. While it specializes in scanning functionality, we recommend using it along a trading software that can display the number of trades per bar (as distinct from volume).
As detailed in our post about stock validation methodology, monitoring trade rate per second is crucial for momentum trading. We’ve found that stocks showing genuine momentum typically execute at least 10 trades per second. This high trading rate indicates active market participation and validates that the price movement is supported by substantial trader engagement. Think of it as taking the market’s pulse – a higher trades-per-second rate suggests more traders are actively participating in the price discovery process.
Setting Up Your Trading Charts
To effectively monitor trades per second on your charting platform, follow these steps:
First, create a 1-second interval chart for your selected stock. Ideally, your platform should display all seconds, even those without trades, to maintain consistent time tracking.
Next, add a “Number of trades” (or equivalent) indicator to your chart. To smooth out the data and get a clearer picture of trading activity, apply a 60-period (one-minute) simple moving average to this indicator. This will show you the average trades per second over the most recent minute.
For cleaner visualization, you might prefer hiding the price data to focus solely on the trades-per-second metrics:
For example, in the case shown above, the pink line indicates an average of 3 trades per second over the latest 60 bars (1 minute). This falls below our recommended threshold of 10 trades per second for optimal momentum trading conditions.
Recommended Trading Software
If your current platform doesn’t support these specific chart configurations, we highly recommend SierraChart. We use it daily for our trading activities and can vouch for its reliability and functionality. While we have no affiliation relationship with SierraChart, we believe it offers exceptional value for momentum traders.
Current SierraChart Pricing (as of our latest update):
- Package 10 – Integrated Standard (Monthly): $36
- US Equities Consolidated Tape: $10
- Total Monthly Investment: $46
This package provides access to both the SierraChart platform and real-time stock data – a remarkably competitive offer in today’s market. The combination of comprehensive features and reasonable pricing makes it an excellent choice for serious traders.
When using SierraChart, it’s crucial to enable the Odd Lot feature in your chart settings. To do this, navigate to Chart Settings, then select Chart Data, and enable “Include Odd Lot Equity Trades.” Without this setting enabled, odd lot trades will be excluded from your data stream, which can significantly impact the accuracy of your momentum measures.