Intraday Trading Tips

1. Understanding Intraday Trading

Before diving into tips, let’s understand what intraday trading means.

Definition: Intraday trading involves buying and selling financial instruments—stocks, futures, options, or currencies—within the same trading session.

Objective: Profit from short-term price fluctuations.

Settlement: All open positions must be squared off before market close.

Leverage: Traders often use margin (borrowed money) to maximize gains, but this also increases risks.

For example: If you buy 100 shares of Reliance at ₹2,450 in the morning and sell them at ₹2,480 by afternoon, your profit is ₹3,000 (excluding brokerage).

2. Why Intraday Trading Attracts Traders

Quick profits: No need to wait for years like investors.

Leverage advantage: Small capital can control large trades.

Liquidity: You trade highly liquid stocks that allow easy entry/exit.

No overnight risk: Positions close before the market shuts.

However, the risks are equally high—overtrading, market volatility, and emotional decisions can wipe out capital quickly.

3. Golden Intraday Trading Tips
Tip 1: Choose the Right Stocks

Not all stocks are suitable for intraday trading.

Prefer liquid stocks (e.g., Reliance, Infosys, HDFC Bank).

Avoid penny stocks with low volumes.

Track stocks in the Nifty 50 and Bank Nifty basket—they have strong daily movement.

Look for stocks that follow market trends and are backed by news, earnings, or events.

Example: A stock with daily volume above 10 lakh shares is generally liquid enough for intraday trading.

Tip 2: Trade with a Plan

Trading without a plan is like sailing without a compass. Define:

Entry price – When to buy or sell.

Exit price – Where to book profits.

Stop-loss – How much you are ready to lose if the market goes against you.

A simple 2:1 risk-reward ratio is ideal. If you risk ₹1,000, target ₹2,000 profit.

Tip 3: Learn Technical Analysis

Intraday trading depends more on charts than company fundamentals.

Use candlestick patterns (Doji, Hammer, Engulfing).

Apply moving averages (50-day, 200-day) to spot trends.

Watch RSI (Relative Strength Index) for overbought/oversold zones.

Check Volume Profile to confirm momentum.

Example: If a stock breaks above a resistance level with high volume, it signals a potential intraday buying opportunity.

Tip 4: Follow Market Trend

“The trend is your friend.”

If the market is bullish, focus on buy opportunities.

If bearish, focus on short-selling opportunities.

Avoid going against the broader market trend.

Intraday traders often use Nifty and Bank Nifty movement as indicators of overall sentiment.

Tip 5: Use Stop Loss Religiously

The most important tool in intraday trading.

Decide in advance how much loss you can tolerate.

Place stop-loss orders immediately after entering a trade.

This prevents panic selling and large losses.

Example: Buy at ₹500, set stop-loss at ₹490. If the stock falls, you exit automatically, limiting loss.

Tip 6: Don’t Trade on Emotions

Greed and fear are the biggest enemies.

Avoid “revenge trading” after a loss.

Don’t chase stocks just because they are moving fast.

Stick to your trading plan, not your emotions.

Tip 7: Timing Matters

First 15 minutes after market opens = high volatility. Wait and observe.

Best trading hours: 9:30 AM to 11:30 AM and 1:30 PM to 2:30 PM.

Avoid trading just before market close unless you are squaring off.

Tip 8: Don’t Overtrade

Trading too many stocks at once increases confusion.

Focus on 2–3 quality trades per day.

Avoid random entry and exit without reason.

Remember: Fewer quality trades > Many random trades.

Tip 9: Keep Learning from Market News

Earnings results, RBI policy, crude oil prices, inflation data—all impact intraday trends.

Use reliable sources like Bloomberg, Moneycontrol, NSE updates.

Avoid tips from WhatsApp or Telegram groups without proper analysis.

Tip 10: Maintain Trading Discipline

Follow your rules strictly.

Keep a trading journal: Note entries, exits, reasons for trade, and results.

Review mistakes and improve.

4. Intraday Trading Strategies

Apart from general tips, let’s look at popular intraday strategies:

Breakout Trading: Enter when price breaks a strong support or resistance.

Momentum Trading: Buy rising stocks with strong volume, sell falling ones.

Scalping: Make multiple small trades for tiny profits.

Gap Trading: Trade based on price gaps at market opening.

Moving Average Crossover: Buy when short-term MA crosses above long-term MA, and vice versa for selling.

5. Risk Management in Intraday Trading

Without risk management, even the best trader will fail.

Never risk more than 1–2% of your capital per trade.

Diversify trades instead of betting everything on one stock.

Use proper leverage—don’t borrow excessively.

Conclusion

Intraday trading can be profitable, exciting, and rewarding, but it demands discipline, knowledge, and patience. Following intraday trading tips like choosing liquid stocks, sticking to stop-loss, respecting market trends, and avoiding emotions can make a big difference between success and failure.

Remember: In trading, survival is more important than speed. If you protect your capital and manage risks well, profits will follow.