What is Intraday Trading?
In simple terms, Intraday Trading is the activity of buying and selling equity/commodities/currency within a single trading day. For example, if one wishes to do Intraday Trading in equity, they would buy/short-sell a stock and then square off their position before the market closes for the day. The market hours for Equity in India are from 09:15 AM – 03:30 PM (excluding weekends).
In this type of trading, positions are taken on with large numbers with the expectation that a small movement in the price will provide the trader with good returns for the day.
Can We Make Money in Intraday Trading?
The short answer to that question is yes, it is possible to make money through Intraday Trading. However, there is no single technique that guarantees success in this style of trading. The Stock Market is a very volatile place and there are several factors that affect the prices of the assets trading here.
One must first invest in gaining proper knowledge from experienced professionals, practice what is taught, and then only take part in Intraday Trading.
What is Intraday Trading Example?
Let’s say stock ‘A’ costs Rs. 20 per stock and for some reason you expect the price to go up during the day. This reason could very well be because of a news piece and is very likely to impact the share price. Also, let’s assume your broker allows you leverage of x10 for this stock in particular. Then with a capital of Rs. 5,000, you buy 2,500 shares of stock ‘A’. Now, the trade goes in your favor and the price is now Rs. 20.50 and you choose to exit your position.
What has happened is, you have earned .5 rupees per stock that you bought (2,500) and results in a net profit of Rs. 1,250. This is a 25% return on capital and is very possible through Intraday Trading.
What Is The Best Strategy for Intraday Trading?
Since the market is volatile and unpredictable each and every day, the strategies you will adopt for the day change every day. There are several factors such as the day’s sentiment, sectors in focus, stocks in the news, global cues, etc that determine what strategy you must adopt.
Rather than looking for strategies for intraday trading, it is better to learn how the market works through Technical and Fundamental Analysis. This way you will know exactly what has to be done depending on the day.
What Is Timing for Intraday Trading?
First of all, Intraday Trading can be done for Stocks, Commodities, and Currency. The timings for each of these instruments are slightly different.
The market timings for Equity (Stocks) is between 09:15 AM and 03:30 PM.
For Commodities, the market timings are from 10:00 AM to 11:55 PM for the Non-Agricultural commodities, and 10:00 AM to 05:00 PM for the Agricultural Commodities.
The market timings for the Indian Currency Derivatives Market are from 09:00 AM to 05:00 PM for Currency pairs with INR as the Base Currency. For Cross Currency Pairs the market timings are from 09:00 AM to 07:30 PM.
Can I sell Intraday Share Next Day?
Yes, you can choose to carry forward your position for more than a day but for that, you must have adequate balance in your Broker’s trading account to be able to buy all the shares you have bought using leverage.
Which Chart is Best For Intraday?
Candlestick charts work excellent for any sort of Technical Analysis, including for Intraday Trading. You must first learn how the market works and then stick to a good strategy.
Which Timeframe is Best for Intraday?
Again, there is no single answer to this question and it depends on what day it is, and how the market sentiment is for the day. That being said, The daily, 5 minutes, 10 minutes, 15 minutes and 30-minute charts work well with Technical Analysis.
How Do I Select Stocks For Intraday?
For Intraday trading, first of all, you must look at stocks that have a high daily traded volume. Then you must follow those stocks for a while and see how they react after reaching certain levels using Technical Analysis. Another way to select stocks is by paying attention to the prevailing sectoral news.
Which Share Are Good For Intraday Trading?
High Volume shares are the only ones to be traded Intraday. This is because they are easy to obtain at the limit price that you set.
Intraday Trading Tips India
Rather than looking for Intraday Trading Tips, it is much better to learn how the market moves and how big of a role Technical Analysis plays when it comes to Intraday Trading. Once you manage to learn all of this, stock selection and entries will come to you very naturally and you will see that there are fresh opportunities every single day.
Intraday Trading For Beginners
If someone is new to the stock market, it is not advisable for them to start trading immediately. They must first learn Technical Analysis and then spend a month or two practicing what they have learned. During this practice, they will develop valuable insights that just simply cannot be taught. Goaled offers several courses that can help you get started with all of this.
How Long Should You Hold Stocks?
The answer to this question depends on what your outlook for that particular stock is. If you believe that there is a positive news piece that would impact the company soon, you could buy the shares just before the event.
Similarly, if technical analysis tells you to enter into a trade you may enter and then hold your position until the same analysis tells you to exit the trade.
Intraday Trading Rules
Say you have learned Technical Analysis and are ready to trade Intraday. Here are a few tips that would help you with decision making.
- Do Not Overtrade.
- You do not need to trade every day.
- First, determine the trend of the index. Then Look for opportunities.
- Do not try to cover your losses.
- Follow a single strategy and do not make decisions out of it.
- Put aside your emotions.
- Always use a stop loss and maintain your risk-reward ratios.
Goaled’s Stock Market Courses in Mumbai
Be it Intraday Trading, Swing Trading, or Investing. Goaled has different strategies for all the styles one wishes to adopt. What determines your approach is how much time you able to dedicate to the stock market in a day. That being said, every approach is profitable in its own way if practiced with discipline. Click Here for our most famous course for beginners.