Intraday trading, also known as day trading, involves buying and selling stocks on the same day before the market closes. Unlike long-term investing, intraday trading aims to make profits from short-term price fluctuations within a single trading session. It’s fast-paced, exciting, and potentially profitable—but it also carries higher risk. Here’s how beginners can get started with intraday trading in India.
1. Understand the Basics
In intraday trading, you don’t hold stocks overnight. Your goal is to take advantage of price movements during the day. You must close all open positions by the end of the trading day, or your broker may do it automatically. It’s important to understand concepts like market orders, stop-loss, target price, volume, and volatility.
2. Choose the Right Trading Platform
Pick a reliable broker that offers a fast, secure, and user-friendly platform for intraday trading. Some of the most popular platforms in India include:
- Zerodha Kite
- Upstox
- Angel One
- 5paisa
- Groww
Look for features like real-time charts, technical indicators, and low brokerage fees.
3. Select Liquid Stocks
Always trade stocks that have high trading volumes. Liquid stocks allow easy entry and exit without big price gaps. Avoid penny stocks or illiquid shares as they can be volatile and difficult to sell quickly.
4. Set Entry and Exit Points
Before placing any trade, define your entry price, target price, and stop-loss level. A stop-loss helps limit your losses if the trade goes against you. For example, if you buy a stock at ₹100 and expect it to go up to ₹105, set a stop-loss at ₹98 to protect your capital.
5. Follow Technical Analysis
Intraday traders rely heavily on technical analysis rather than news or fundamentals. Use charts, candlestick patterns, moving averages, RSI, MACD, and volume indicators to make decisions. Technical tools help identify trends, reversals, and breakout opportunities.
6. Stick to a Trading Plan
Successful day traders always follow a trading strategy. Avoid random trades based on rumors or emotions. Set a fixed capital limit for daily trading and never risk more than 2–5% of your total capital on a single trade.
7. Manage Your Emotions
Intraday trading can be stressful, especially when the market is volatile. Greed, fear, and impatience often lead to poor decisions. Stay disciplined and stick to your trading plan. Take breaks, review your trades, and learn from mistakes.
8. Start Small
Don’t jump into the market with big capital. Start small and gradually increase your exposure as you gain experience. Use virtual trading or paper trading platforms to practice without real money.
9. Monitor the Market Closely
Stay updated with market news, economic data, corporate announcements, and global trends. A sudden news item can impact stock prices and your position quickly.
10. Review Your Performance
Keep a trading journal where you log each trade, strategy used, result, and learnings. Regular review helps improve your decision-making and understand what works best for you.