How to select Best Intraday Trading Stocks

How to select Best Intraday Trading Stocks

While selecting stock for intraday trading traders need to be really careful. There are thousands of equities to choose from, and day traders can pick virtually any sort of stock they want. This method is very useful for traders who don’t have too much time for analysis or are not very comfortable with the analysis. The video shares some simple steps that anyone can perform to identify or select Best Intraday Trading Stocks.

Here are some rules which you can follow while selecting stock for intraday trading.

Rule 1: Liquidity, liquidity, liquidity.

Liquid stocks have big volume, whereby larger quantities can be purchased and sold without significantly affecting the worth. Since intraday trading strategies depend on speed and precise timing, a lot of volume makes getting into and out of trades easier. Depth is also essential, which shows you how much liquidity a stock has at various price levels higher than or below the current market bid and offer.

Rule 2: Medium to High volatility.

Day traders require price movement in order to make money. Day traders can choose stocks that tend to move a lot in dollar terms or percentage terms, as these two filters will often produce different results. Stocks that tend to move 3-dimensional or more per day have consistent large intraday moves to trade.

Rule 3: group followers.

While there are those who specialize in contrarian plays, most traders look for equities that move in correlation with their sector and index group. this means that, when the index or the sector tick upward, the individual stock’s price also increases. this is important if the trader wants to be trading the strongest or weakest stocks each day (discussed in more detail later). If a trader opts to trade the same stock every day, it is wise to focus on that one stock, and there is no need to worry about whether it is correlated with anything else.

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