Intraday Trading Strategies,Tips and Risks 

Intraday trading is a fast-paced gateway to the stock market, that’s why each day it attracts more than thousands of traders. Buying and selling within the same day offers to traders is like a promise to get profits quickly. But remember, if you don’t have a solid intraday trading strategy, you can’t succeed. Also, you need proper risk management skills. Through this blog you can explore what intraday trading is, dive deep into its actionable strategies, must-know tips and help you to decide the right trading style.  

What is Intraday Trading? 

Intraday trading isn’t a complicated term in the stock market; it refers to buying and selling of financial instruments within the same trading day. The major goal of this strategy is to capitalize on small price movements of stocks, indices, or commodities before the market ends.  

Some people have doubts regarding how intraday trading differs from delivery-based trading. Here’s the answer;  

🠖 Intraday Trading: It involves buying and selling stocks within the same day, with all positions squared off before the market closes, so no ownership of the stock is carried overnight. 

🠖 Delivery-Based Trading: It involves buying stocks and holding them in a demat account for more than one day, granting the investor full ownership.  

Intraday trading is widely used in,  

🠖 Stocks: Highly liquid shares of companies 

🠖 Indices: Nifty, Sensex, etc. 

🠖 Commodities: Gold, Crude Oil, etc.  

🠖 Forex: Currency like USD/INR 

Key Intraday Trading Strategies 

If you want to become a successful day trader, choosing the right intraday trading strategies is very important. Here you can see the most effective strategies used by professionals;  

Momentum Trading 

Momentum trading is considered one of the best intraday strategies, and it is most effective during early trading hours or when the trading volume is high. The traders can buy stocks that are going up in price, and they can sell them when the momentum slows down.  

Breakout Trading 

Breakout trading is where traders enter a trade when the price moves above resistance or below support levels with a strong volume. The major goal is to profit from sharp price movements that follow these breakouts.  

Reversal Trading Strategy 

This strategy involves identifying points where a stock’s price trend is likely to change direction from up to down. The traders they selected for this strategy will aim to buy near the bottom of a downtrend or sell near the top of an uptrend. 

Scalping 

Scalping is a quick trading strategy, here traders can make multiple small trades throughout the day to get profit from tiny price movements. So, the positions are held for just seconds or minutes and that will offer low risk for each trade.  

Moving Average Crossover Strategy 

Moving Average Crossover Strategy is a technique of using two moving averages, one short-term and one long-term. The buy signal occurs when the short-term average crosses above the long-term, and a sell signal when it crosses below.  

Gap and Go Trading Strategy 

The Gap and Go strategy involve spotting stocks that open with a significant price gap due to news and then continue moving in the same direction after the market opens. Traders aim to capitalize on this early momentum for quick intraday profits. 

Pullback Trading Strategy 

Pullback Trading Strategy means entering a trade during a temporary dip (pullback) in an ongoing trend. Traders wait for the price to retrace slightly and then buy in uptrend or sell in downtrend. 

Must-Know Intraday Trading Tips 

Understanding tips of intraday trading is also important as learning strategies. Here you can see the essential intraday trading tips for beginners and professionals.  

Understanding of Intraday Trading 

The person should know the meaning of terms like scalping, bid price, alpha, beta, etc. And strategies.  

Begin With Virtual Money 

If you start trading with virtual money, you can learn different trading techniques and there is no risk of losing money. 

Trade With a Plan Not Emotion 

Emotional trading leads to irritational decisions, so you must stick to your plan, even when the market gets volatile. 

Follow Market Trends 

Nobody can predict market movements, but traders use some technical factors to depict the market. The fact is these factors don’t provide any guarantees, so you should travel with the market trends.  

Spend Time for Monitoring 

In day trading, the trader should monitor the market movements throughout the market session. It is necessary to make the right decisions and is not suitable for professionals who are employed in another job.  

Stick to 1-2 Trades a Day (for beginners) 

If you are a beginner and trade so many trades a day, that will cause negative impacts. Overtrading will increase stress and risk more than profit, so you must focus on quality trades, not quantity.  

Risks Involved in Intraday Trading

We know the rewards from intraday trading is attractive, but intraday trading rules demand caution due to inherent risks, like: 

🠖 High Volatility: Price can change anytime that results in unexpected losses. 

🠖 Execution Delays: A few seconds can make or break a trade in fast-moving markets.  

🠖 Emotional Pressure: Constant monitoring can lead to heavy stress. 

🠖 Quick Decisions: Short-term fluctuations and false signals can mislead traders that will lead to poor decisions.  

🠖 Overtrading: Trying to make multiple trades in a day will result in losses and high brokerage charges.  

Intraday vs Delivery Trading: A Quick Comparison  

Feature	Intraday Trading	Delivery Trading
Time Horizon	Same day	Days, weeks or months
Ownership	No	Yes
Goal	Get profit from small price movements	Long-term growth
Risk Level	High	Moderate to low
Capital Requirement	Lower (with margin)	Higher
Monitoring	Active	Less-time intensive
Ideal For	Active Traders	Long-term investors

Who Should (and Shouldn’t) Do Intraday Trading?

Ideal for; 

Traders who have high risk tolerance 

The person who is available to monitor the market in the trading hours 

They have strong market knowledge and quick decision-making abilities  

Not Ideal for; 

Beginners who are new to the trading 

Long-term investors seeking portfolio growth 

Individual with limited time to monitor the market 

Conclusion 

Choosing the right intraday trading strategy, disciplined mindset and knowledge about the intraday trading rules will lead a trader to success. If they aren’t planned well, that causes losses so the traders who are ready to start intraday trading should be able to manage risk to avoid these losses. Whether you are just starting or looking to refine your trading approach, this blog is a guide for you.  

Master the markets with smart strategies and real-time insights. Open your free trading account with Navia today and start your journey with expert guidance! 

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DISCLAIMER: Investments in the securities market are subject to market risks, read all the related documents carefully before investing. The securities quoted are exemplary and are not recommendatory. Brokerage will not exceed the SEBI prescribed limit.