How to pick a good stock for intraday trading?

An intraday trader is a stock trader who buys and sells shares on the same trading day (or sometimes T+2). He capitalizes on the probable rise of share value. He may also short to minimize loss when the shares are on the downturn. They keep eye on short moves of the market. They mostly play on margin money offered as a loan by the broking houses. For more details, you should take an overview of Indian stock market.

How to pick a good stock for intraday trading

Day traders and intraday traders are the highest risk takers and hence are rewarded/doomed accordingly. They look for making quick bucks in a rapidly changing market conditions. Most of these traders keep a keen eye on charts, mostly candlestick charts which gives them information on the just future condition of the market. They use technical analysis as one of their major tools, to determine right conditions when to enter and exit and hopefully make a profit.

How can stock tips for trading be helpful at this juncture? How can trader benefits from intraday trading? What should trader be looking for before he selects the shares for intraday trading?

1.Liquidity

It is the most important aspect intraday traders should look for. Liquid stocks have a massive volume that is a high number of sellers and buyers. Because of high volume, buying and selling do not affect the prices considerably that is price alterations are not much.

2. Stock tips for intraday trading

Here are some things that intraday traders should look for like percentage of liquid stocks should be more in his portfolio. He should avoid volatile stocks as much as possible. Trade in better-correlated stocks. Should evaluate the trends before investments, should choose and buy the stocks after doing the technical and fundamental analysis.

3. Avoid volatile stocks

When company results or important announcement is made the concerned stock usually displays high volatility.  When this happens then the trend is one way, either most people will be selling or buying. And these stocks become illiquid.

Must Read: How can you learn stock trading?

4. Correlated stocks

Stock picking should have better correlation with key sectors and important indices (currency, commodity, oil etc).  That is when an overall index or a sector sees an increasing movement, it boosts the stock price. Like if the currency is strong then those sectors dealing in exports take a beating and vice versa.

5. Latest trends

One of the intraday stock tips is to stay ahead of the latest trend which will provide a better rate of return on your investments. Traders should have a quick realization of those stocks that are rising swiftly. They should opt for quality research to identify the trend, but sadly most of the traders do not invest time and effort into the research.

Above given stock market investments tips – do and dont’s will be helpful in your day to day trading. If you are looking for intraday tips which will give you maximum gain with the minimum risk you can register for a free two-day trial. For two-day free trial please fill the form with all the required details and submit. There are hosts of services being provided depending on your risk taking tolerance and amount of investment you can afford.

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