Intraday trading or day trading is the method of trading through which traders capitalize on the small fluctuations that occur in the market. With day trading, you can earn stable and persistent profits regularly. However, while intraday trading can be profitable, it can also lead to heavy losses. The losses in intraday trading can be because of wrong decisions, relying on unreliable sources, etc. Therefore, you can follow a few steps if you wish to earn consistent profits through intraday trading.
Steps you should follow for earning stable profits in the market:
- Select minimal liquid shares:
Intraday trading involves purchasing and selling shares on the same day. Therefore, it is recommended that traders should opt for liquid shares for investing. When you‘ve chosen a few liquid shares for trading, you get to profit from their fluctuating price movement.
You must conduct a decent amount of research about the stocks you wish to select for intraday trading. When you have a decent idea about their fundamentals and historical performance, you will make an informed decision. Good research is also an excellent way to protect yourself from potential losses.
- Set entry and exit prices:
Once you have selected stock for trading, you must set an entry and exit price on the stock. Setting these prices is an excellent way to earn substantial profits through trading. When you have a clear target in your mind, you will settle the trade once you have reached the target. Along with this, following this tip will help you earn stable profits. Along with this, it protects you from being driven by the greed of earning better profits.
- Stop loss:
A stop loss is a trigger that you must set for all of your trading orders. With a stop loss, your trading order will be sold once the price dips below a specific price in the market. It is an excellent way to protect yourself from potential losses in the market.
- Don’t move against the market:
The market always has specific trends, and it will be better for you to move with the market instead of going against it. When you move with the trends in the market, you can earn stable profits. However, moving against the trend can lead to substantial losses.
Thus, if you’re planning to begin intraday trading, it is important to follow certain steps to ensure you earn decent profits. Following the tips listed above will make sure your trading orders in the market are profitable.