Intraday Trading Rules
When to buy and when to sell
Intraday Trading Rules – When the markets open, many experts advise individuals to avoid trading during the first hour. You may be able to earn more profits if you trade between noon and 1 pm.
Follow your investment strategy
A clear plan is needed every time users initiate a trade so they know how they will do intraday trading rules.
Establishing the entry and exit prices before beginning the trade is crucial. Intraday trading rules include using a stop loss to limit the risk of losing your position.
Furthermore, users are advised to close their position once the stock reaches its target price, rather than being greedy and expecting higher profits.
Also Read: Trading Indicators For Intraday Trading: A Simple (But Complete) Guide
Exiting in an unfavorable situation
When a trade provides profits and a price-give indication of a future reversal (price showing potential to reverse), it is prudent to exit the open position and book the profits.
In addition, if the market conditions are not favorable, You should not wait for the stop-loss trigger to be triggered before exiting the position. In this way, traders can protect their losses.
Make Smart Investments With Small Amounts
- It’s not unusual for beginners to get carried away once they make some profits when day trading.
- It is difficult to predict trends in markets, even for experienced professionals.
- This can lead to beginners losing their entire investment.
- It is therefore important to invest smaller amounts that a user can afford to lose during intraday trading.
- Individuals will be protected from financial difficulties should the markets not favor them.
Choose liquid stocks based on research
- Intraday trading rules should learn the basics of the stock market, as well as fundamental and technical analysis before they begin.
- It is beneficial to take the time to read the research resources available on the Internet.
- Also, there are hundreds of stocks traded on the equity markets, but traders can only trade two or three liquid ones.
- A liquid stock is one that has high intraday volumes.
- Traders can exit open positions before the end of a trading session if they are liquid.
Closing all open positions is always a good idea
Traders may get tempted to take delivery of their positions if their targets aren’t achieved.
Even if traders have to book a loss, closing open positions is one of the biggest mistakes.
Spend Some Time
Professionals who hold a full-time jobs are not suited for day trading.
A trader needs to be able to monitor market movements throughout the course of the trading day (from the opening bell to the closing bell) so as to be able to make the right calls when necessary.