Top Intraday Trading tips you should know

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Top Intraday Trading tips you should know


Selling and buying the stocks in the same trading session to make quick gains by predicting the price movement of a stock is called Intraday Trading. Day traders keep a close eye on some stocks to make profits. While it might sound easier, it is a risky trading form, primarily undertaken by beginners.

 

You can mitigate some risks by following essential Intraday Trading tips:

 

  1. Research: Understand basic terminologies and Intraday Trading strategies like:
    1. Long position: Buying a stock hoping its price will rise by the end of the secession
    2. Short position: Buying a stock believing its price would fall by the end of the session.
    3. IOC orders:Cancel orders that get executed immediately. All unexecuted orders must be cancelled.
    4. Support level: It is the level below which shares do not fall.
    5. Resistance level:The level above which the shares do not rise.

 

  1. Knowledge: Intradaytraders need to stay updated with the latest market and economic news. So, whichever stock you want to trade in, make a list, and regularly read news related to them. Also, watch out for leading business news outlets for any news that can impact your Intraday Stocks.

 

  1. Money: Decide how much funds you want to invest in the beginning and consider all the margin and other associated feesyou need to pay besides buying the assets.

 

 

  1. Time: If you are serious about Day Trading, you must set aside the entire day to research and trade. You cannot hope to be successful by spending only a couple of hours every day.

 

  1. Penny stocks: You may want to trade with penny stocks, considering they are affordable. But such stocks are usually illiquid and do not provide many opportunities to make gains, so you want to steer clear of them.

Top Intraday Trading tips you should know
Top Intraday Trading tips you should know

 

 

  1. Stop-loss: Under Day Trading, there are chances your stocks might not behave like you expect them to. In such cases, to limit your losses, decide at which price you would square off your position and salvage something than losing everything. Stop-loss allows you to do just that. Set your stop-loss at a price three times lower than you would have liked to book the profit.
  2. Targets: As a day trader, you have the potential to earn high returns, more than you expected. In such cases, stick to your targets and do not get greedy unless you have a logic-backed reason to believe the prices can go higher.

 

  1. Close open positions: It is good to close your open positions on the same trading day. Sometimes, when you do not meet the set targets, you might want to give yourself a day to reach the target. However, you do not know what a new day might bring, and your stock could slide lower. In such cases, it is idealfor closing all your open positions to prevent further losses.

 

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