Intraday trading is a popular source of income for many individuals. It involves buying and selling the stocks on the same day and closing the transaction. Intraday trading can be very profitable if it is done in the right way. To help you in earning more profits through intraday trading, we list down some of the intraday trading tips that would help you in making not only higher profits but also earning good returns on a consistent basis.

Intraday Trading Tips

• Always Put a Stop Loss

You can be a successful trader only you if follow a disciplined approach. One of the most important things to do while doing intraday trading is to put a stop loss in place. Stop loss saves you from extra losses that you could have incurred if the price of the stock had fallen further. Therefore, stop loss while trading protects you from extra losses which can lead to erosion of your trading capital.

• Trade in Stock with Higher Volume

Intraday trading must be done in stocks that have higher volumes. This is because as an intraday trader you want to close your position on the same day and this is possible only if there are sufficient buyers or sellers at a given price. Higher volumes in stocks ensure that you would find easy entry and exit points to square off your transaction by the end of the day.

• Read Technical Charts

When you take an intraday trade after reading the charts of the stocks, the probability of making profits is higher. Technical study helps in determining the future price movement of the stock. Chart reading is an art and if you learn it properly, you can make good money out of intraday trading.

• Time Your Trade

Many times traders take an intraday trade as soon as the market opens. This is not the right approach. As an intraday trader, you must know how to time your trade and recognise the time points when the trade would be more profitable. Timing your trade will make you more disciplined and help you in making higher profits.

• Follow the Market Trend

As an intraday trader, you must always follow the market trend. It is advisable to avoid taking any position that is just against the sentiment of the market. Like for example, in the bull phase of the market, purchasing the stock at a lower price and selling at a higher price is the right strategy. Similarly, in the bear market, selling the stock at a higher price and purchasing it back on the same day at a lower price can prove to be a correct strategy. Therefore, as an intraday trader understanding the market trend is very important.

• Keep Aside Your Emotions

The stock market is volatile and it can change its direction at any time. As an intraday trader, you will have days when things would not go how you like them to be. During such period holding or taking trade out of emotions can prove to be fatal. You must avoid taking any decision out of emotions. Keeping a practical approach in the stock market will help you in becoming a successful trader.

The above mentioned are a few tips that every intraday trader must follow to become successful. If you are a newbie to the stock market and want to indulge in intraday trading, you can open your demat account with services such as Kotak Securities and enjoy hassle-free premium services.