Five Interesting facts about Intraday Trading:-
An intraday trading strategy is defined as an overall trading strategy characterized by the regular transmission by a customer of a multiple intraday electronic orders to effect both purchase and sale in the same security or securities.
Here are five interesting facts about it:–
1. Knowledge about index – If the index is in positive from yesterday and the share you are holding is in minus then it should be cut and if the intraday trend of the index is in buy then one should buy a stock in which is in plus. The index is in minus then one should look to short stocks which are minus and not stocks which are in plus. It is not necessary that a stock which is weak today during intraday trading might be weak tomorrow also, simultaneously if a stock is strong today might not be strong tomorrow.
2. Trade-in liquid stocks – It is suggestive to trade in liquid stocks since it has very high volume and also entry and exit can be very fast in such stocks. Do papers trading before you start trading so that when you start making paper profits, then shift to actual trading.
3. Consistency in volume – Keep your volume constant since if you trade in five lots of nifty future then trade in five lots only. This position can be increased only when you are satisfied with your trading for a month. It should not be that one day you buy five lots and the next day you trade in ten lots and the third day you get a loss and stop trading for two days.
4. Be Wary of Rumors – In the age of communication, rurumoursan spread faster than fire. Ensure that you double-check every information that you receive on a social media platform with a trusted source. Make decisions only after you are sure about the authenticity of the information.
5. Avoid the first hour of trading – Most price movements happen during the first hour and the last hour of trading every day. the prices can be skewed in either direction. Unless your research is air-tight, buying early in the morning can usually be costly. Also, most traders start booking profits after 2 pm. Hence, selling before 1 pm is usually recommended for new traders.