Buying and selling of stocks within the same trading day is called intraday trading or day trading. Stocks are traded at stock exchange during trading hours which is predetermined by the exchange. In intraday trading stocks are bought or sold in huge numbers with only one intention, which is, booking profit within a day. Stocks that are purchased are not intended for investment, while the trader earns in anticipation of the stock indices to a move north before he offloads his stock.
Usually, the online account is used for purpose of intraday trading. In intraday trading, the trader has to specify that the order he/she is placing is for intraday trading. Since the orders are squared off before the end of the trading session it is called intraday trading.
A few points are discussed below that you should keep in mind while trading in intraday trading.
- Intraday trading is risky
Intraday trading is riskier than investing in the regular stock market as there is a time bounding that one has to sell before close whatever be the market condition that day. Beginners should understand the basic of intraday trading to avoid loss. Intraday trading is better for experienced traders. Always remember to use the capital for trading which you can afford to lose or that you have as a surplus because in case of loss, you should not face financial difficulties. Intraday tips from Alliance Research will help you learn the art of trading faster.
- Using intraday indicators to gain more
One has to do a lot of research when it comes to booking profits in intraday trading and indicators help you out for the same. Intraday tips from the experienced traders come as a blessing in disguise. The indicators are the beneficial tool which should be used with a widespread and prevalent strategy so as to maximize returns.
- Risk management in intraday trading
Trading in the stock market has an inherent with risk which all intraday traders have to face. Daily volume of shares traded and price volatility are the additional factors that intraday traders have to face when they pick the stocks. It is advisable not to risk over two percent of their total capital on a single trade so as to manage risk appropriately.
- Using one-day interval charts
Daily charts are the charts used by most intraday traders. These charts depict price movements of a share of companies on a one-day interval. Reading charts is a popular technique that helps illustrate the price moments between the opening and closing of the daily trading session. There are various charts which help intraday traders like 2 minute, 5 minute, and 15 minute. These charts are candlestick or bar charts which represent the opening, closing, high and low for the given time interval. Along with this traded volume is also represented.
- Picking relevant stocks for intraday trading
Picking stocks for intraday and long-term are two different aspects and the intraday trader should know the difference. Many people are unable to make the profit because they do not select appropriate stock. Choosing the right stock, at right time and at the right price is an art that day trader learns through experience.
We provide tips for choosing the right stock, at the right time, for a right price for buying and/or selling. You can contact us or fill out our inquiry form and we will communicate with you.