How to Choose Stocks for intraday?

how to choose stocks for intraday

Intraday means buying and selling the stock on the same day. If you want to choose stocks for intraday, you should know how to choose the stock to earn high profits.

There are numerous assets from which choosing one can be confusing for you. We will help you know about intraday trading and how to choose the stocks for intraday. 

Example: If the company stocks open at Rs 1000 in the morning when the market gets open, and you buy it. In the evening it will go to 1200 then you will get profit.If you have bought 5 stocks, then the profit will be 1000 in intraday stocks. 

What is Intraday Stock Trading? 

Intraday Stock Trading means buying and selling the stocks on the same day before the market closes. You can do stocks trading by using an online platform, and there are many online platforms available for intraday trading. 

Suppose you want to buy stocks of any specific company; you have to mention intraday in the portal of the online platform you are using to invest in stocks. You can also call it day trading

How to choose stocks for intraday?

Choose liquid stocks

Liquid stocks have high trading volumes, so you can purchase the stocks in large quantities and sell them at the end of the day.

It does not affect the price of the stocks, and in lesser liquid stocks, you cannot buy and sell large quantities of stocks. The liquidity of stocks depends on the kind of trades placed by traders. 

Check the liquidity at multiple price levels. Understanding the changeability of the liquidity at multiple prices will help you to buy stocks at the correct time.  

Example: The quantity of stocks from 40,000 to 80,000 is enough if the trade is Rs 50 or 100. If the quantity is in hundreds or thousands, the volume requirements will notably become larger. Select the highly liquid stocks for the best intraday trading. 

Medium to High Volatility

Intraday traders should choose the stocks whose prices keep on changing every day. The stocks that are almost stable every day cannot bring benefits; there is risk in trading in stable stocks.

You should choose the stocks that fluctuate every day because it increases the chance of high profits.

Filter out the stocks with an adhesive price and choose the stocks that move a minimum of 3% every day.

Trade-in Good Relation Stocks

Choose the stocks that have a strong relationship with the US dollar and INR movement. Look for assets that move in relationship with their sector and index group.

When the index goes upwards, the stock price will also increase. If you choose the same stock every day, you should focus on that stock, then do not think about whether it is linked with anything else. 

Follow the Market Trend

When you use the online platform to buy stocks, you will see the graph on your screen that shows the waves of the stocks, and you have to follow that wave trend.

If you move with the trend, analyzing the everyday timing will be beneficial for you. Look at stocks that possibly rise according to everyday waves.

During the downtrend, try to take short positions, and during the uptrend, try to take long positions. 

Study the Trendline

The trend is a visible guide that shows where the price will begin and end.

You can choose the trendline in intraday trading and invest in the early time when stock is below the trend line and is slowly moving towards the trendline.

Be patient and let the stock reach or go above the trend. 

Also Read: 15 Best Share Market Books

Is Trading in Stocks for Intraday Illegal?

No, trading in stocks for intraday is not illegal. You can trade in stocks, but it can be risky, so choose the stocks wisely. 

Is Intraday Trading Similar to Gambling?

Yes, we can say that intraday trading is like gambling because it is not a long-term investment.

You can get a profit in a few minutes or hours, and there is a high risk like in gambling.

If you buy a large number of stocks and the price lets low in the end, you will get into huge losses like gambling. 

How much can you Earn by Intraday Trading?

It depends on how many stocks you are buying. Many traders who do everyday trading earn around 50,000 every month because they have enough knowledge about the market. 

Is there any Limit to Earning in Intraday Stocks?

No, there is no limit for earning; you can earn how much you can according to your stocks. 

Is Intraday Trading Safe for Beginners?

Yes, it is safe for beginners, but only when they know how to choose the stocks every day. They should take some help from experienced traders and get some knowledge about the stock market.

In starting, beginners should spend less money in the stock market to avoid huge losses in the initial stage. 

Final Thoughts

If you traders follow these suggestions, they can earn huge profit in stocks for intraday. You can get profit by following the trend and being active.

Do not involve in intraday if the stocks are under the trendline because it happens sometimes, and these strategies do not work in such cases. 

Recommended:

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Best Time Frame For Intraday Trading

When is Intraday Profit Credited?