Tips
for Intraday Trading
Below
are a few tips for intraday trading in Indian share market which will help
investors in making the right decision:
- Choose Two or Three Liquid Shares
- Determine Entry and Target Prices
- Utilizing Stop Loss for Lower Impact
- Book Your Profits when Target is reached
- Avoid being an Investor
- Research your Wish list thoroughly
- Don’t Move against the Market
- Basic Rules for Intraday Trading
- Intraday Trading indicators
- How to make profit in intraday trading
- Intraday Time Analysis
- How to Choose Stocks for Intraday Trading
Choose
Two or Three Liquid Shares
Intraday
trading involves squaring open positions before the end of the trading session.
This is why it is recommended to choose two or three large-cap shares that are
highly liquid. Investing in mid-size or small-caps can result in the investor
having to hold these shares because of low trading volumes.
Determine
Entry and Target Prices
Before
placing the buy order, you must determine your entry level and target price. It
is common for a person’s psychology to change after purchasing the shares. As a
result, you may sell even if the price sees a nominal increase. Due to this,
you may lose the opportunity to take advantage of higher gains because of the
price increase.
Utilizing
Stop Loss for Lower Impact
Stop
loss is a trigger that is used to automatically sell the shares if the price
falls below a specified limit. This is beneficial in limiting the potential
loss for investors due to the fall in the stock prices. For investors who have
used short-selling, stop loss reduces loss in case the price rises beyond their
expectations. This intraday trading strategy ensures emotions are eliminated
from your decision.
Book
Your Profits when Target is reached
Most
day traders suffer from fear or greed. It is important for investors to not
only cut their losses, but also to book their profits once the target price is
reached. In case the individual thinks the stock has a further possibility of
rising in price, the stop loss trigger must be readjusted to match this
expectation.
Avoid
being an Investor
Intraday
trading, as well as investing, requires individuals to purchase shares.
However, factors for both these strategies are distinct. One kind adopts
fundamentals while the other considers the technical details. It is common for
day traders to take delivery of shares in case the target price is not met. He
or she then waits for the price to recover to earn back his or her money. This
is not recommended because the stock may not be worthy of investing, as it was
purchased only for a shorter duration.
Research
your Wish list thoroughly
Investors
are advised to include eight to 10 shares in their wish lists and research
these in depth. Knowing about corporate events, such as mergers, bonus dates,
stock splits, dividend payments, etc., along with their technical levels is
important. Using the Internet for finding resistance and support levels will
also be beneficial.
Don’t
Move against the Market
Even
experienced professionals with advanced tools are not able to predict market
movements. There are times when all technical factors depict a bull market;
however, there may still be a decline. These factors are only indicative and do
not provide any guarantees. If the market moves against your expectations, it
is important to exit your position to avoid huge losses.
Stock
returns can be huge; however earning smaller gains by adhering to these
intraday trading tips & strategies should be satisfactory. Intraday trading
provides higher leverage, which effectively provides decent returns in one day.
Being content is crucial to succeeding as a day trader.
