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11 May 2018

SHARE MARKET--An experienced share market Guru mentioning few points to keep in mind while doing intraday trading which will surely help you and improve your intraday trading.

·       Stock selection: Selection of stock plays a major role in intraday and if you don’t improve that, your earning chances will remain poor. So how should be selection of stock? Let me brief you that you have to select only A group stock while trading for intraday which has good volumes. Never select high volatile stocks like PC Jewellers or JublFood. Select less volatile and stable stock for intraday which gives movement with market. Buy Bullish stocks in rising market and Sell bearish or weak stocks in falling market.
·         Risk Management: Risk plays a big role in intraday trading. It’s not necessary that you will get profit everyday or your all trades are right so you have to stop your losses somewhere and for that Stoploss is Must. You should apply a calculative stoploss to overcome your risk. If you are aiming for 10 Rs target, you should put 3 to 4 Rs stoploss as well. If you can’t do that, you can’t minimize your losses.
·         Market trend: First of all you have to identify market or Nifty trend before entering into any intraday trade. You are not supposed to buy any stock because it has fallen much or you are not supposed to sell a stock because it has risen too much. Never grab a falling knife or never do bottom fishing. Identify market trend and go with trend only.

·         Stocks in News: Avoid that kind of stocks which are news driven or any data, news or results going to announced. If you are a safe and calm trader, just wait for perfect opportunity rather than trading in any random trade. Stock which are in news can give big movement and can give you big losses too. So stay cautious in this kind of movement.
·         Overtrading: Never prefer too many trades in intraday. Rather than doing 5–10 trades in a day, just do 1–2 trades which can give you enough money for intraday. You can’t be millionaire in a day so never try to do too many trades in which you can’t concentrate.
·         Emotions: You have to control your emotions to avoid losses in Intraday trading. Emotions makes you hold your loosing trade and once loss will be increased, you won’t be able to exit in big loss. So control your emotions while trading and be practical while trading. Small loss can be covered in next trade but if it becomes bigger, you can’t survive with low capital.
·         Greed: Intraday traders are greedy sometimes. If they are getting 10k profit with 1 lac capital in intraday, they don’t book it and loose that ultimately because they can’t book on time. You have to keep balance between Fear and greed because if you will not book profit on time, you may loose it. You have to set in your mind that I am happy with this much of profit for today.
·         Never Average: This is most common reason I have seen in my career. People average their loosing position which makes it worst to exit because if you double the quantity, risk will be doubled too and you won’t be able to book loss which can vanish your whole capital. Never average loosing trade. Just cut the loss and move forward. You are not God so you can’t be right in every trade.
·         Follow Basic technical: Basic technical knowledge gives you idea that how stock should perform. Like if any stock is not breaking it’s previous day’s low and showing strength in intraday irrespective of market movement, it can be bought with previous day’s low Stoploss. Same way on selling side. I am just giving an example that BPCL was not crossing 463 from 3 sessions and not able to sustain there so if you sell it on intraday basis with that stoploss or even positional, it fallen 40 rs from there. So you have to follow basic technical to improve intraday trading.
·         Buy on Support and Sell on Resistance: This is basic thumb rule for intraday trading that you have to buy strong stocks at support for intraday and sell weak stocks at resistance. This basic formula will give 70% to 80% accuracy. Just do little homework before doing any trade and see the difference. Rather than following anyone, make yourself eligible.
I hope my detail answer will help new comers to gain some knowledge.

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