How to Find the Best ASX Stocks When the Market Turns: The Momentum Profile Filter System
- Christopher Hall
- 14 hours ago
- 11 min read
The Short Answer: How to Find ASX Stocks Before the Recovery
When ASX markets sell off, the best post-recovery performers are not found in the wreckage. They are found near their 52-week highs. Christopher Hall, AFSL-licensed trading educator at Finer Market Points, has developed a proprietary six-step filter — the Momentum Profile system — that identifies these stocks systematically before the market turns. The three critical data points are: proximity to the 63-day high (within 2%), Launchpad count (optimal: 3–4 appearances in 30 days), and Coils rank (optimal: 70s range). Applied together, these filters surface the stocks statistically most likely to lead the next ASX recovery.
Why Most ASX Traders Are Unprepared When the Market Recovers
Most traders share the same experience during a market selloff. They watch their portfolios decline, wait for clarity, and only act once the recovery is already underway. By then, the best-positioned stocks have moved. The entry point that was obvious in hindsight is now a chase trade, and chasing is where risk-adjusted returns collapse.
This is not a discipline problem. It is a preparation problem.
The traders who consistently profit from market recoveries are not better at predicting when the bottom will arrive. They are better at knowing which stocks to own the moment it does. They build that shortlist before the turn — sometimes days, sometimes weeks in advance — so that when the signal comes, execution is immediate.
The March 2026 ASX selloff demonstrated this clearly. With the market at an 18-month low and 80% of traders losing money, a specific group of ASX stocks was trading within 2% of their 52-week highs. Those stocks did not need to recover. They needed only to break out.
The Momentum Profile filter system is built to find exactly those stocks.
What Is the Momentum Profile Filter System?
The Momentum Profile is a proprietary screening tool developed by Finer Market Points that filters and ranks every tradeable company on the ASX simultaneously across multiple momentum metrics. Members of the FMP YouTube channel access a ranked output every Thursday — a shortlist called the Launchpad — that is generated using this system.
The core philosophy departs from conventional stock-screening logic. Most screeners search for stocks that have fallen the least or recovered the fastest. The Momentum Profile does the opposite: it identifies stocks that demonstrated relative strength during the selloff. Stocks that held near their highs while the broader index fell. Stocks that were already coiling before the market gave anyone permission to be bullish.
This methodology is grounded in Mark Minervini's relative strength principle, articulated in Trade Like a Stock Market Wizard: the stocks that lead the next bull cycle are identifiable before that cycle begins, because they refuse to participate in the decline. William O'Neil's Relative Strength (RS) Rating research at Investor's Business Daily reached the same conclusion independently — stocks ranking highest on RS during a market correction are the most reliable candidates to lead the subsequent advance.
The Momentum Profile applies both principles systematically to the ASX, where market structure, liquidity profiles, and sector dynamics differ materially from US markets. For a detailed breakdown of how US momentum methodology translates to Australian conditions, see How to Scan the ASX for Leading Stocks Using Proven US Methods.
How to Use the Momentum Profile Filter: 6 Steps to Identifying ASX Leaders Before the Breakout
The filter is applied in six steps. Each step eliminates stocks that do not meet the criteria. What remains is a ranked shortlist of the highest-probability candidates for the next ASX advance.
Step 1: Set the Lookback Window to Two Weeks
In a volatile market, recent price behaviour is more informative than longer-term trends. The filter focuses on the last two weeks of trading to identify which stocks are currently behaving as relative strength leaders. A stock that held near its highs last month but has since deteriorated is not the target. Current behaviour is the signal.
Step 2: Apply the Minimum Price Filter
The filter includes all stocks with a closing price above 20 cents. Experienced momentum traders typically focus on stocks above 50 cents for liquidity and spread reasons, but the system captures the full opportunity set. Members adjust this threshold based on their own risk tolerance and trading style.
Step 3: Check the Launchpad Count — Target 3 to 4 Appearances in 30 Days
This is the most counterintuitive finding in the entire filter system, and it took years of monitoring to confirm.
The Launchpad is the weekly shortlist published every Thursday for FMP YouTube members. It surfaces stocks currently meeting momentum criteria across the ASX. The natural assumption is that a stock appearing frequently on the Launchpad — 10, 12, or 15 times in 30 trading sessions — is the strongest candidate. The data says otherwise.
The optimal Launchpad count is 3 to 4 appearances in 30 days.
Stocks that appear repeatedly have typically already extended from their base. The momentum is visible, which means it has already been priced in by earlier movers. The highest-performing stocks in FMP's historical data appear in the Launchpad for a brief window — entering the list, holding for 2 to 4 sessions, and then breaking out. The signal is emergence, not persistence.
A stock appearing 7, 10, or 15 times is not a stronger signal. It is a warning that the setup may be extended.
For context on how thematic clusters reinforce Launchpad signals, see Launch Pad Themes: Finding Emerging Opportunities Before the Market.
Step 4: Check the Coils Rank — Target the 70s
The Coils rank measures the tightness of a stock's recent price consolidation, expressed as a percentile ranking across the entire ASX universe. A Coils rank in the 70s, achieved within the last 5 trading sessions, is the target zone.
Think of it this way: a spring under compression stores energy. The tighter the compression, the more energy released when the spring is let go. Price action works identically. A stock that has been trading in a progressively tightening range — lower highs and higher lows converging — is storing energy. When that range resolves to the upside, the move is typically fast and significant.
The Coils rank quantifies that compression mathematically. What Minervini identifies visually through a Volatility Contraction Pattern (VCP), the Coils rank identifies algorithmically across every stock on the ASX at once.
This is a non-obvious result: when FMP first built this metric, the expectation was that a moderate rank would prove optimal. The data consistently pointed to the 70s as the sweet spot — not the 90s, where compression can become so extreme that breakouts are erratic, and not below 65, where the pattern lacks sufficient tightness to generate reliable momentum.
For a full explanation of what VCP patterns look like on ASX stocks and how to identify them manually, see How to Identify VCP Patterns on ASX Stocks: The 3-Stage Australian Market Adaptation.
Step 5: Apply the 2% Proximity Rule
The final toggle filters for stocks trading within 2% of their 63-day (quarterly) high.
This is the most counterintuitive element of the entire system. During a market selloff, every instinct pushes traders toward stocks that have fallen the most — the recovery candidates, the beaten-down value plays. The Momentum Profile does the opposite. It looks for stocks that barely fell at all.
The historical basis for this is clear: the best performers out of any significant market low were, in the majority of cases, already near their 52-week highs when the market was still declining. They pushed new yearly highs within two weeks of the market bottom. By the time the index confirmed its low and retail traders felt safe to buy, these stocks had already moved.
The 2% proximity rule captures that cohort in advance. It is not possible to know the exact market bottom until after the fact. What is possible is filtering for the stocks most likely to lead once it arrives.
Step 6: Identify Thematic Clusters
Once the filtered list is generated, the final step is to scan for thematic groupings within it. When multiple stocks from the same sector or theme appear simultaneously — critical minerals, energy transition, healthcare, defence — that cluster is not coincidence. It signals institutional money rotating into a sector before the move becomes broadly visible.
Thematic clustering is where individual stock selection gives way to a higher-order filter: sector momentum. A stock with a Coils rank of 74 inside a thematically clustered group is a more reliable candidate than an isolated stock with a rank of 79. The cluster is the conviction signal.
This approach mirrors the methodology described in Mark Minervini VCP Patterns: Why Sector and Thematic Filters Matter More Than Stock Selection and is reinforced by From Energy to Growth: The 3-Signal Framework Gary Glover Uses to Identify the Next ASX Market Leaders.
What the Filter Surfaced During the March 2026 ASX Selloff
The following stocks appeared at the top of the Momentum Profile filter during the March 2026 market selloff. They are not presented as investment recommendations. They are presented as evidence that the filter works — that during a period when the broader ASX was declining, a specific group of stocks met every criterion and subsequently behaved as the methodology predicted.
4DX (4DX.ASX) — Launchpad appearances: 3 days in the last 30. Coils rank: 72 in the last 5 sessions. Met both hero criteria simultaneously. Appeared near the top of the filtered list.
TBN (TBN.ASX) — Launchpad appearances: 1 day in the last 30. Coils rank: 73. Trading below 50 cents, which places it outside the preferred range for many members, but the chart structure was textbook — a tight volatility contraction pattern forming near previous highs while the market fell beneath it.
BRK — Brookside Energy (BRK.ASX) — Launchpad appearances: 4 days in the last 30. Coils rank: 73. Higher volatility than TBN, but both filter metrics sat squarely in the optimal zone. The 4-day Launchpad count is precisely the sweet spot the data identifies.
TEA — Launchpad appearances: 7 days in the last 30. Coils rank: 65. Included here as the cautionary example. Seven Launchpad appearances signal a setup that has likely extended. Many FMP members traded TEA successfully in an earlier rally — but the filter correctly identified that at 7 appearances, the risk/reward profile for a fresh position had deteriorated.
PLS (PLS.ASX) — A larger-cap example. Coils rank: 65. Trading within striking distance of its 52-week high. Demonstrates that the filter operates across all market capitalisation ranges, not just small and micro-cap stocks.
The lesson is not which specific stocks the filter found. The lesson is that the filter found them — systematically, in minutes, from the entire ASX universe — while most traders were focused on what had fallen the most.
Why the Coils Rank and VCP Pattern Are Connected
The Coils rank is the algorithmic equivalent of what a trained eye sees in a VCP chart. Both measure the same underlying phenomenon: progressive volatility contraction indicating institutional accumulation ahead of a breakout.
Minervini describes this in Think & Trade Like a Champion: when institutional buyers accumulate a position, their activity absorbs selling pressure and tightens price ranges progressively. Each successive contraction is smaller than the last. Volume dries up. The stock coils. When supply is finally exhausted, a modest increase in demand triggers a breakout that appears sudden to observers but was structurally inevitable.
The Coils rank measures that tightening algorithmically across every ASX stock. A rank in the 70s identifies the stocks currently in the most advanced stage of that accumulation process.
For traders who want to understand the manual VCP identification process alongside the algorithmic approach, the following resources cover the methodology in depth:
How to Access the Momentum Profile Portal
The Momentum Profile filter and the weekly Launchpad shortlist are available through the FMP YouTube Membership. Members receive the ranked list every Thursday — covering every tradeable ASX company, filtered and ranked across all six criteria described in this article.
The membership is designed for traders who want to spend less time screening and more time trading. The filter does in minutes what would otherwise require hours of manual analysis across thousands of ASX tickers.
Not sure if membership is right for you? The free VCP quiz is the recommended starting point. It walks through the core concepts behind the Momentum Profile methodology — what the reports contain, what they are designed to find, and how members use them in practice. It takes approximately 8 minutes and gives immediate feedback on your current knowledge gaps.
Once you understand the methodology, the decision to join becomes straightforward.
Frequently Asked Questions
What is the Momentum Profile portal? The Momentum Profile is a proprietary ASX screening tool developed by Finer Market Points that filters and ranks every tradeable ASX company across six momentum criteria simultaneously. Members access the ranked output every Thursday via the weekly Launchpad shortlist, published through the FMP YouTube Membership.
Why is a Launchpad count of 3–4 better than 10–15 appearances in 30 days? Stocks appearing 10–15 times in the Launchpad have typically already extended from their base — the momentum is visible and therefore already priced in by earlier participants. Stocks appearing 3–4 times are in the early emergence phase: they have qualified recently but have not yet attracted broad attention. FMP's historical data consistently identifies 3–4 appearances as the statistical sweet spot for subsequent outperformance.
What does Coils rank measure in ASX momentum trading? The Coils rank measures the tightness of a stock's recent price consolidation, expressed as a percentile ranking across the entire ASX. A rank in the 70s, achieved within the last 5 trading sessions, identifies stocks in the most advanced stage of volatility contraction — the same condition that Mark Minervini identifies manually as a Volatility Contraction Pattern (VCP).
What is the 2% proximity rule in ASX stock filtering? The 2% proximity rule filters for stocks trading within 2% of their 63-day (quarterly) high during a falling market. It is based on the historical observation that the strongest post-recovery performers were already near their 52-week highs while the market was still declining — and typically pushed new yearly highs within two weeks of the market bottom.
What is a Volatility Contraction Pattern (VCP) and how does it relate to the Coils rank? A VCP is a chart formation where price volatility decreases progressively through a series of contractions, indicating institutional accumulation ahead of a breakout. It was codified by Mark Minervini and is the foundation of his SEPA methodology. The Coils rank is the algorithmic equivalent — it identifies the same condition mathematically across every ASX stock simultaneously. For a full explanation, see What is a VCP Pattern? Mark Minervini's Volatility Contraction Pattern Explained.
How often is the Launchpad list updated? The Launchpad is published weekly, every Thursday, exclusively for FMP YouTube members. It is the primary output of the Momentum Profile filter system and ranks stocks across all six criteria described in this article.
What is the difference between momentum score and Coils rank? Momentum score measures the rate and magnitude of recent price gains — how fast and how far a stock has moved. Coils rank measures consolidation tightness — how compressed recent price action has become. Both metrics serve different filtering purposes. A high momentum score identifies stocks already in motion. A high Coils rank identifies stocks about to move. The optimal filter combines both.
Educational Disclaimer
This content is for educational purposes only and does not constitute financial advice. Past performance is no guarantee of future results.
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