Best Bse Stocks For Intraday Trading – Earning profit each day by trading is not easy. Day trading is also a risky proposition and can lead to losses as quickly as it can lead to profits. It requires a different strategy and practice than any other delivery, position or swing trade. A solid and effective intraday trading strategy can reduce risk and make profits.
This article will tell you how to choose stocks for intraday trading, determine targets, stop losses and price, and discuss some of the best exit strategies for options and intraday equity trading.
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For those new to the stock market, an intraday trading strategy can be simply defined as buying or selling equity and fixing it on the same day. The main objective of any intraday trader is to buy low and sell high – or sell high and buy low, in case of short selling (options only) – within a single day.
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Intraday trading is different from regular trading, where you can buy equity at any time or options for several days.
Intraday trading strategies are very effective in the equity market. A trader can use intraday trends to make intraday profits. Such strategies involve trading the underlying security in a specific area for a few minutes to hours rather than the usual holding time of days or weeks.
Assuming you already know the basics of stock market investing and technical analysis, here are some intraday equity strategies and options trading.
The moving crossover strategy is a simple and effective way of intraday trading. It involves taking two moving averages, one slow (a few hours) and one fast (a few minutes), to generate buy and sell signals.
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You wait for the fast moving average to cross above the slow moving average and generate a buy signal (in case of a long trade). It shows that the trend is changing to the upside, and it’s time to buy.
Similarly, you wait for a fast moving average to cross below a slow moving average to generate a sell signal (for slow trading). This indicates that the trend is turning downward, and it is time to sell or create a put option.
One of the advantages of this strategy is that it can be used in any time frame from 1 minute to 15 minutes in intraday trading. Another advantage is that it does not require fancy indicators or complex analysis. All you need are two simple Moving Averages (MAs).
Trend following is a strategy where you buy stocks in an uptrend and sell them when they start to trend down. This strategy works very well, but it requires patience and discipline. It will help you if you have a clear understanding of bullish and bearish candlestick patterns to make this trade.
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Scalping is an aggressive form of trading where you try to make small profits by using small price movements. It is a very profitable strategy if you do it successfully. However, it requires quick wits and a lot of knowledge to be profitable.
Breakout trading is another popular strategy that involves buying stocks that are about to break out of their previous highs or lows. If you enter the trade at the right time and exit before the stock reverses, this can be very fruitful. You need to check the Bollinger band and Dow theory to correctly identify the exit.
However, this strategy can be dangerous as you may be caught in false positives if you are not careful.
Choosing one of the methods listed above to trade is the first part of an intraday trading strategy. In order to make a profit, you need to properly trade by choosing the right stock, setting entry and exit points, determining the price, etc.
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There are more than 5 thousand companies listed on BSE and NSE, and you cannot trade in all of them. You can scan the charts of 40-100 stocks before shortlisting a few stocks to trade. It would help if you listed a maximum of 5 stocks or options to trade.
Note: You can use whatever indicator works best for you. However, the 44 SMA is one of the best indicators to analyze equity intraday trading if you are new.
Once you have shortlisted a stock, you must define an entry point where you would like to call, put options, or buy equity. It will be more profitable for you to enter the market during the opening hours of the market, that is, at 9:15 am.
It is important to specify the exit point of the trade. It would be better if you don’t sit in front of your screen all day waiting for the trade to be profitable.
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Determining the exact time to exit an option is never certain, but the trader must determine the amount of risk and reward based on data, assumptions, and trends.
It is important to determine the profit target and the risk you are willing to take before entering a trade.
Example: If the entry point is ₹ 100 and the low tail of the candle is ₹ 95. then, the stop loss should be 95, and the maximum risk per share will be ₹ 5. Therefore, the reward should be set as double . risk, i.e. ₹ 10. Therefore, the target price should be ₹110 (100+10).
Another thing to consider when setting targets and stop loss orders while trading options is volatility. In day options, the reward-risk ratio can be 3: 1. The target can be set with Fibonacci retracement levels, and the stop loss can be set three times lower than the target.
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Example: If a short trade is currently trading at ₹ 500 and is expected to decline by ₹ 18 as a Fibonacci retracement, the target price would be ₹ 482, and the stop loss would be ₹ 500+ (18/3) = 506 .
It is important to calculate the lot value or prices before taking a position in the market.
For example, if a trader has ₹ 1 lakh and is willing to risk only 2% per trade, then the maximum loss that can be taken on that trade would be ₹ 2000. the stop loss is ₹ 95/share, then the amount should not exceed 400 shares= ₹ 2000/ (100-95).
The number of options you trade should be based on margin, premium and implied volatility. If the premium is high and the implied volatility is low, it would be better to buy more values. Margin requirement and lot size should determine price.
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For example, if you buy 10 contracts of an option with a premium of ₹ 10 and a margin requirement of ₹ 500, you put ₹ 5,000 as collateral for the trade. This means that any move against your position can result in a 100% loss. Therefore, it is important to trade at prices you are comfortable with.
These strategies are typically used by people with access to real-time market data, such as knowledgeable stock and options traders and fund managers. If you want to trade intraday equities or options, you need access to the right charting and technical analysis software.
As a trader, to set up a profitable intraday trading strategy, you need to study candlestick patterns, compare indicators, calculate margins, etc. the market.
With AmiSignals, you can easily see when there are trading opportunities in the market. You can also set up custom alerts to be notified immediately when a trading opportunity meets your criteria.
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In addition, AmiSignals comes with built-in risk management tools that allow you to manage your risk exposure and protect your profits. With these tools, you can easily manage your stop loss levels and set profit targets to know your maximum risk and reward potential before entering any trade.
By using AmiSignals, you can take the guesswork out of daily trading and increase your chances of success in the market. AmiSignals is worth considering as part of your overall strategy if you are serious about making money from intraday trading.
Although many traders make profits from intraday trading, they are bound to lose at some point. However, here are some tips that can help maximize profits while minimizing risk in day trading.A Guide to the Best Intraday Trading Strategies for Beginners: There are hundreds of Intraday Trading Strategies for traders to apply to make money in the stock market. However, not all of them are easy enough for beginners to use and make money.
In this article, we will cover the four best Intraday trading strategies for beginners. Let’s get started.
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As the name might suggest, Intraday is that event that ends on the same day. Similarly, Intraday trading is a type of trading, where the buying and selling of stocks or commodities are completed within the same trading session.
Intraday trading is one of the most sought after (and high volume) trading methods among market traders. With proper analysis and execution, it has the potential to be very productive