‘Buy low, sell high’ is the mantra of stock traders everywhere. But nowhere is it more evident than in the intraday trading space.
The intraday trader does not go looking for an investment to hold on to for the long term. Instead, their objective is to profit off the minute price fluctuations of a stock over a single trading day.
The day trader’s goal seems simple enough: Buy stocks at low prices and sell them when the prices rise. However, a great deal of planning is required to achieve this target. As a beginner on the intraday trading scene, you may not know where to start.
There is such an abundance of market data to sift through, so many charts to look at, so many research reports to cover.
If you find yourself stumbling, intraday trading tips from the experts could help. They can serve as thumb rules to get you started in the fast-paced world of intraday trading.
What is Intraday Trading?
Many beginners hesitate to trade in the stock market, due to a lot of fears and doubts. But, if they follow all-important intraday trading tips they can effectively invest money in intraday trading. Intraday trading is the best for investors who want to achieve short-term investment goals. Because here you can buy and sell the shares on the same day. With the help of the trading app all the transactions are done effortlessly.
Intraday Trading Tips
Intraday trading is not as easy as it looks. What seems like random buying and selling may actually be based on a very detailed plan, and it requires a lot of discipline. If you need the inspiration to start your journey as a day trader, the following intraday trading tips could provide some guidance.
When compared to the regular stock market intraday trading is a risk-associated investment. Intraday trading is good for beginners who have advanced knowledge of the stocks. If your risk appetite is high, then you are free to invest in intraday trading.
Below we have mentioned the intraday trading tips that every beginner should keep in mind while investing.
Intraday Trading Tips for Beginners
Below are the best intraday trading tips for beginners in the Indian stock market which will help investors in making the right decision:
- Shortlist your Intraday Trading Stocks
- Know when to Enter a Trade
- Develop a Clear Exit Policy
- Have a Plan, But be Flexible
- Know the Intraday Trading Thumb Rules
- Watch for Research-Based Tips
- Choose Two or Three Liquid Shares
- Determine Entry and Target Prices
- Utilizing the Stop Loss for Lower Impact
- Book Your Profit When Target is Reached
- Avoid Being Investor
1. Shortlist your Intraday Trading Stocks
Remember, you will be taking positions and squaring them off within a single trading session. So it is important to choose liquid stocks (e.g. shares of large-cap companies). Such stocks are in high demand, making it easier for you to find a buy or a seller before the market close. Most traders have a shortlist of eight to 10 stocks across sectors and segments that they follow closely. This makes it easier to recognize patterns and trends that can be capitalized on.
2. Know when to Enter a Trade
Although the opening hour sees heavy activity, there is also the risk of volatility. This is why experts often suggest waiting 30 minutes to an hour before making your move. By now the day’s trends should gradually become clear. If you have been following a particular stock, figure out the right time to enter into a position on it. Here again, planning comes in handy, and it is a good idea to plan your entry points in advance.
3. Develop a Clear Exit Policy
Just as important as knowing when to enter a trade is recognizing when to exit it. Experts offering intraday trading tips will always advise you to set a stop-loss target. If the stock price moves against you, the stop loss will get activated at the trigger point. The trade will be closed and your losses minimized.
While you’re at it, set a profit target as well. This allows you to close the position and collect profits when your specified target is met. It prevents you from waiting too long for further gains that may never arrive.
4. Have a Plan, But Be Flexible
Your intraday trading strategy provides direction. But as a day trader, you should always be prepared for the market to move unpredictably. If the market is not moving the way you had expected, exit any open positions and cut losses. Avoid the temptation to wait for the market to move in your favor.
5. Know the Intraday Trading Thumb Rules
- If you are new to intraday trading, start small with one or two trades per day. Many seasoned day traders execute only four to five trades in a single session.
- Remember to close all open positions before the closing hour. Otherwise, they will be closed automatically at the market close and you might miss the opportunity to book profits.
- Technical indicators hold the key to successful trades. Use intraday charts to spot trends and reversals.
6. Watch for Research-Based Tips
Many brokers provide intraday trading tips and stock recommendations based on research. For instance, they may highlight specific stocks along with entry points and stop-loss targets. If you do not trust your own judgment at first, these research-based stock tips could provide essential support. This is why it is helpful to open an account with a broker like Kotak Securities that has a dedicated research division.
7. Choose Two or Three Liquid Shares
It is one of the most important intraday trading tips. Almost every professional and experienced investor gives advice to the beginners to choose two or three large cap-shares that are highly liquid. The reason why to avoid small or midsize caps is because of low trading volumes.
8. Determine Entry and Target Prices
At the time of buying stocks, you need to check the entry and target prices. Always buy when the price of the stock is low and sell when the price gets high. It is one of the easiest intraday trading tips for beginners.
9. Utilizing the Stop Loss for Lower Impact
Stop loss is the significant intraday trading tips in India because it can reduce the risk of loss. If you place the order via app then you will get a feature stop-loss, which can automatically sell the share when the price gets down. One of the key advantages of using these intraday trading tips is you don’t need to monitor the stock prices all day. It automatically saves from facing loss by selling stocks if the price falls below.
10. Book Your Profit When Target is Reached
Many beginner traders suffer from the fear of losing money in intraday trading. But, these intraday trading tips for beginners can overcome their fear. It is imperative for the traders to cut down the loss by booking your profit when the target is reached. You can use the stop trigger function, which automatically sells the stocks when the price gets reached.
11. Avoid Being Investor
Whether it is intraday trading or regular stock marketing investment, you need to purchase or sell shares. The only difference between intraday trading and regular stock investing is that you need to buy and sell the stocks on the same day in intraday trading. Intraday trading is for a shorter duration of time; that why you need to keep your eye the whole day on the screen, and when the price gets high sell them instantly.
5 Things You Need to know when you Intraday Trading
Above mentioned intraday trading for beginners, India helps you to make your investment process hassle-free. Now we are going to tell you the 5 effective things you need to remember while doing intraday trading.
- Never trade when the market gets volatile. Because during volatile markets, your prices move unexpectedly. In the event, if you trade between the volatile market, you cannot bear the loss. Always make an investment in intraday trading when market prices are predictable because it gives you a clear idea of whether you should buy or sell the shares or not.
- Do not invest in intraday trading without taking the help of the stop loss. Because it not only reduces the loss but also makes you confident that your money is in a safe place. The function of the stop-loss to automatically sell the shares when its price gets increased. You can easily manage the unmanageable MTM losses that you may face while investing in intraday trading.
- Always avoid the lure tips on intraday trading for beginners in India. There are so many sites that offer you numerous advice on how to place orders or other intraday trading tips in India. It is good to take the help of experts who can guide you effectively in intraday trading.
- Before jumping into intraday trading or it is imperative to know when to buy or sell or stay away from the stock market. When you take rest from the investment it gives you time to think about the intraday strategies.
- Before opting, the shares of the companies read their latest reports like the company’s revenue, market status, and position. Never buy shares of the new companies. It is imperative to buy the shares of the top companies which have been ruling in the market for several years.
What do You Need to Trade?
First, you need to follow all the best intraday trading tips. And second, you should know when to buy or sell the trade. Throughout the day, the market goes ups and downs. You need to keep an eye on the market and buy the stocks when their price gets down and sell when the prices get up. You can also take the help of the stop-loss trigger, which automatically sells the orders when the price goes up. Follow our intraday trading for beginners’ guide to get the best insight about this trading.
What does Trading in the Share Market Mean?
Buying and selling stocks within a day is known as trading. A trader has a full liability to buy and sell shares of any company that can give him a better return on the investment. By following the trading tips for beginners in India, you can also invest in the intraday hassle-free.
Stock market wins and losses are part and parcel of the day trader’s life. Even seasoned traders who have been trading for decades struggle to predict market movements.
As you gain some experience, you will find that it is not possible to eliminate the losses completely. But with the right intraday trading tips, you can learn to minimize the impact of losses with simple tweaks to your trading strategy.
There is plenty of advice to go around, so make sure to pick the tips that fit your intraday trading style. While there is no substitute for thorough technical research, advanced charting tools and educational resources on your broker’s website could help you along.