Intraday Trading: A Short Guide

Trading in the share market is all about buying and selling shares in the share market in order to earn short term profits. Intraday Trading is the process that involves buying and selling stocks within the same trading day, during the hours that are accepted by the stock exchange. The market foes up and down throughout the day and along with that the prices of the shares fluctuate as well. In the case of intraday trading, the shares are not purchased with the aim to invest them for a long time, but for the purpose of earning profits by keeping an eye on stock market movements. Before beginning to trade,understanding the meaning of intraday trading is very important. In this article, we will try to help you learn about intraday trading and also give you some Intraday Trading Tips.

Understanding the fundamentals of intraday trading is very important in order to make regular and consistent profits. It is always better to understand the current market trend. If the market is falling, sell first and buy later. Whereas, if the market is on the rise, buy first and sell later. Make a trading plan and stick to it. And although there are great chances of making good profits, Intraday trading can be risky as well. Technical charts that rely on many time intervals are used to make the decision of buying and selling shares. The stock market needs to constantly monitored in order to avoid heavy losses. Also, since these trades are intraday, the question of Demat debit or credit does not arise. There are various Intraday Trading tipsthat you should know for efficient trading and avoiding losses. Here is a list of some intraday trading tips that will help you get familiar with intraday trading.

  • Pick easily sellable stocks (High Liquidity): Stocks with high liquidity rates can easily be sold at any point in time. Hence it is highly advised to choose stocks with high liquidity while intraday trading. On the off chance that your stock has no buyers, you may face some losses.
  • Choose stocks with good trading value: Stocks with high trading value imply that these stocks are the ones that attract a large number of buyers. You can buy and sell these stocks without any difficulties.
  • Stay up to date with the stock market: Share market is notorious for being volatile. Due to this, you should always be aware of what is happening in the market to avoid facing losses. Read up on all the news and updates about the stock market.
  • Utilize the stop loss strategy: In case of huge volatility, stop loss will help you avoid losses. It is possible to limit your losses using this strategy. People often fall prey to emotional decisions while buying stocks. Stop loss strategy helps in making the tough decisions. Procastination is not going to be beneficial while intraday trading. So implement stop loss strategy for better profits.
  • Analyze the stock: Research is one of the most important aspects of stock trading. Stock must be analyzed physically and fundamentally before the trading begins.
  • Trading in penny stocks is a big no: Trading in penny stocks is highly risky since they are not liquid and trade at low prices and see high instabilities. Hence, it is advised to avoid trading in these kinds of stocks.
  • Pick stocks that react to news: Expectations and reality are the principles on which intraday trading is based on. It is always wise to choose stocks accordingly.
  • Talk to the expert: Do not jump into the world of trading without proper education. If you are unclear about your decisions, talk to the expert and take their advice. Never take an impulsive decision based only on rumors.

Intraday trading helps you make consistent profit if you trade wisely. We hope this article has been informative and has helped you understand the basic of intraday trading.