The Psychology of Intraday Trading: How to Control Emotions and Make Better Decisions

There is no fixed process to make money in the Indian stock market. Every trader uses their brain to decide on a unique investment strategy. You can also try different trading techniques to find what’s best for you. For example, some of you might be good at taking advantage of price swings in the stock market. In such a case, swing trading might be the apt choice. Some investors might be interested in intraday or day trading to earn quick returns. When done right, intraday trading can help you build substantial wealth. Let us discuss more about intraday trading and how to make it right.

Demystifying intraday trading

Before learning how to succeed, you must understand the intraday trading meaning. Day trading is the practice of buying securities and selling them on the same day before the stock exchange closes. The main aim of day trading is to benefit from sudden or small price movements in financial markets. Day traders keep an eye on price fluctuations and buy securities accordingly. Day traders start taking positions in the market after the stock exchange opens. They tend to close their positions before the stock exchange closes for the day. If financial securities are held for days or months, they will not fall under the umbrella of day trading.

Let us understand the concept of day trading with an example. Consider that the shares of a company show regular fluctuations in the past few days. The price of a share is continuously fluctuating between INR 40 and INR 50 for the past few days. All this is happening within a day, and the price fluctuates between INR 40 and INR 50. Day traders notice this phenomenon and buy shares early morning when the price was INR 40. As soon as the price becomes INR 50 on the same day, traders sell it to make a profit. Day traders can also make a profit out of smaller price fluctuations in the stock market.

How to make better decisions and succeed with day trading?

Here are some tips to succeed with intraday trading in India:

1. Understand whether you want to take long or short positions in the stock market.
2. Buy liquid shares in intraday trading. Liquid securities can be easily sold in the stock market to make a profit.
3. Don’t make compulsive or emotional decisions with day trading. Try to make informed and rational decisions for success in day trading.
4. Decide on a stop loss limit to prevent huge losses. A stop-loss limit will automatically sell shares when their price goes below a certain limit.
5. Use new-age trading platforms to succeed in day trading. New-age trading platforms will offer market insights required to make informed day trading decisions.
6. Use margin trading services from your broker to make bigger day trading deals.

Conclusion

Day trading allows you to earn profits from small price movements in the stock market. It requires immense expertise as you are looking to earn high returns within a day. Don’t forget to choose a reputed stockbroker to help you with day trading!

Summary

Intraday trading allows investors to take and close positions within the same day. When done right, day trading allows you to take advantage of price swings in the market. However, you must control your emotions and make rational decisions to succeed with day trading. Learn more about day trading right away!