Best charts for intraday trading
Intraday trading charts show how price changes over time. The day trading charts are an important part of each trader’s toolkit. These charts are valuable in examining short-term, medium-term, and even long-term periods and can be referred to for more effective decision making. Intraday charts help you better understand how stock prices fluctuate. The graphs show the performance of a certain stock in great detail. Intraday charts are by far the most popular and widely used by intraday traders. This page will explain the many types of charts and their purposes.
1. Line Charts
In intraday trading, line charts are one of the most widely utilized charts. The closing price is the only thing shown on the line charts. Each day’s closing price is linked to the previous day’s closing price. The line graph gives you a quick overview of the prices. This chart, however, cannot be used in the decision-making process because it does not show market trends.
2. Bar Charts
The specific charts are a variation on line charts. Vertical lines in bar charts reflect the price range over a given time period. The open, high, and low prices are also shown in bar charts. These charts provide more information about the stock and are simple to comprehend. Tick charts are a sort of bar graph.
- Tick Charts
Tick charts are one of the best indicator for intraday trading reference sources. The bar is generated every minute when trading activity is strong. In contrast to any other chart, a tick chart provides deep insights during a high volume time.
Candlestick charts show the open, closing, high, and low prices during a trading session. Candlestick charts are best used for short-term analysis and can be used to make judgments based on trends. A Renko chart is an example of a candlestick chart.
- Renko Charts
The Renko chart is used to show price changes. Resistance levels are also identified using these charts.
Let’s take a look at the many types of intraday charts, as well as intraday time analysis and the significance of each chart, in the sections below.
4. 15 Minute Charts
The opening, closing, high, and low prices of a stock are displayed every 15 minutes on the 15-minute intraday charts. Even 15-minute charts are employed for short-term deals that run anywhere from an hour to several trading sessions.
5. Hourly Charts
The hourly charts show how a stock’s price changes every hour. For that particular day, the chart provides a great deal of information. Short-term transactions that last a few hours to days benefit greatly from hourly charts. Every hour for the time period, the chart shows the opening, closing, high, and low prices of the stock.
6. 5 Minute Charts
Every 5-minute interval is displayed in 5-minute intraday charts, which show the opening, closing, high, and low prices of a stock. The chart in question is one of the most widely utilized in the trading world. Short-term and long-term traders both use it. During an intraday trading session, the 5-minute chart is quite beneficial for fast scalps that last from a few minutes to several hours. Long-term traders utilize 5-minute charts to determine the best entry and exit points for transactions that will last a long time. In fact, using 5-minute charts for long-term investments in the stock market is strongly advised.
7. 2 Minute Charts
The 3-hour price activity is shown by the 2-minute charts. Every 2-minute interval, the chart depicts the opening, closing, high, and low price of a stock. Short-term traders also favor the 2-minute charts. This chart was utilized by short-term traders for day trades and scalping, which can last anywhere from a few minutes to a few hours in a single trading session.
8. Tick Trade Charts
Tick-Trade charts are line graphs that show every trade that has been executed in the stock market. Every dot on this graph represents a deal that has been completed. The lack of trading in illiquid marketplaces is represented by a flat line. In highly liquid markets, on the other hand, the graph continually shows movement and depicts price increases or decreases. Traders utilise tick-trade charts for scalping and keeping track of “out of money” trades that need to be corrected.
Always keep in mind that the trader’s perspective changes depending on the time period being studied. Analysing the correct time period is critical for intraday trading success, and it will benefit you greatly in the long run.
Choosing a data interval
The best interval to use is determined by your trading style. Consider wider data intervals if you want to make bigger moves and stay in a position for longer. Smaller data intervals are better if you trade for smaller moves and want to get in and out of positions fast. There is no one-size-fits-all setting that will accommodate every trading style and personal taste.
How to make profit in intraday trading?
Intraday trading is both an art and a science, and both must be mastered. Intraday trading, on the other hand, offers time-tested measures such as breakouts, supports, and relative strengths that can be used to profitably trade intraday. Let’s look at several intraday trading instances to see how we may generate money.
Stop losses, profit targets, and capital protection are all important aspects of intraday trading. The main concern is how to perform intraday trading and make money in the stock market on a daily basis, or at least most days. Intraday share ideas and intraday trading tips abound, but the main problem is figuring out how to profitably trade intraday using a few easy instruments. Before we get into the tactics for making money in intraday trading, let’s start with a simple mantra: keep costs to a bare minimum. Remember that in intraday trading, a rupee saved is a rupee earned.
Making daily profits in intraday trading may be a complete misnomer, as this is simply not possible. However, by adopting a simple systematic strategy to intraday trading, it is possible to be profitable more frequently. Some successful intraday trading tactics are listed below.
1. Intraday trading using stock supports and resistances
Supports are price levels where a stock has a tendency to take support and rebound back in technical analysis. When you see this happen several times, it means the stock is taking support and is a good time to buy. Similarly, if the stock is continuously reaching and reverting to an upper level, it is a hint of a short-term peak. You can sell the shares at that level.
2. Intraday trading based on volume-supported breakouts
Identifying breakouts is another strategy to benefit in intraday trading. When a stock breaks out of a range following an extended period of support from volumes, it is a signal to trade in the breakout direction. That means you should purchase if an upward breakthrough occurs and sell if an upward breakout occurs. How do you tell if a breakout is real or fake? For an intraday trader, a breakout accompanied by a surge in volume is more dependable.
3. Use volume imbalances, but test them beforehand before trading intraday
You’ll notice buy side orders and sell side orders when you open your trading terminal. These are orders that have yet to be carried out. Buying when demand exceeds supply is one technique for intraday traders to profit from these mismatches. However, one must exercise caution because hidden orders and algo commands might arise in a microsecond and prove your judgement incorrect. Use this procedure sparingly and thoroughly before putting it to use.
4. Rumor’s should be bought and news should be sold.
You’ll get a lot of intraday share advice throughout the day. The difficult part is figuring out how to apply these suggestions. Buying on rumours and selling on news is a common intraday trading strategy. If there is a strong rumour about a company’s poor performance, you can sell the shares intraday with a stop loss before the results are released. Use the lower tiers to exit when the actual results are released. This is more of an art than a science when it comes to intraday trading.
5. Intraday trading using the overbought and oversold zones
This article explains how to trade intraday using a combination of charts and subjective judgement. How can you tell the difference between prudent buying and catching a falling knife when equities have sharply corrected? To find overbought and oversold zones in charts, use RSI indicator for intraday. If other circumstances support intraday trading, you can purchase in the oversold zone and sell in the overbought zone!
Intraday trading is a short-term trading strategy that must be handled accordingly. Your main focus should be on risk management and rapidly churning your capital to increase your ROI. Above all, intraday trading is a never-ending educational process!
Entry and exit of intraday trading
The activity of purchasing and selling financial instruments within a single day, or numerous times within a 24-hour period, is referred to as day trading. Investors can profit from modest price swings in this type of trading, which can be a lucrative strategy if done correctly. For newcomers and even those who do not adhere well to this way of trading, analyzing the intraday dynamics might be tough.
Market participants can benefit from data-based chart intervals since they allow them to see charts that are not influenced by time. These charts, like any trading tools, must be customized to the market participant’s personal preferences and strategies. Traders may find it beneficial to experiment with various data kinds and intervals in order to find the ideal combination for their methodology.
Que.1 How can you tell which way the market is going?
Ans. This is a strategy that will never go out of style. Intraday traders that are successful must be aware of the market’s direction or trend. They accomplish this by determining the value range of the stocks they wish to trade.
In trading, this is known as the “80 percent rule.” A value area is defined as the price range in which at least 70% of the previous day’s activity took place. After that is fixed, keep an eye on how that region operates throughout the day.
According to the trading rule, if a stock begins lower than the value area and stays there for an hour, the chances of it entering the value region increase. On the other hand, if a stock opens at a lower price and remains there for an hour, it will eventually fall into the value zone.
If the stock has opened at a greater value, the ideal technique would be to take a short position in an area around the value area. Take a long position on one of the stocks that has opened at a lower price. These are, however, only theoretical strategies. One must work hard and learn more about the nuances of share trading.
Que.2 Why should someone get involved in intraday trading?
Ans. To begin with, it provides insight into the fast-paced trading environment. It’s all about speed, precision, practicality, and patience in intraday trading. However, here are a few reasons why intraday trading is such a wonderful thing to be a part of:
- Intraday trading has the highest margin of any trade.
- The return potential is also strong due to the higher margin.
- To encourage intraday trading, almost every business imposes a minimum brokerage fee.
- It is not necessary to play the long game in order for strategies to pay off.
Que.3 Who do I trade intraday with?
Ans. The importance of choosing the right trader or brokerage firm cannot be overstated. Looking for a suitable partner is one of the first methods to adopt when starting intraday trading.
The ideal trading organization would be one that would provide you with the necessary research and technical assistance to help you succeed. Firms with cheap brokerage costs per transaction would also be a good alternative if you want to enhance the volume of transactions.
Que.4 Intraday trading is appropriate for who?
Ans. There are no restrictions on who can participate in intraday trading. However, it’s important to be aware of the dangers. It’s all about timing in intraday trading. As a result, you must keep your eyes riveted to the screen in order to determine the correct timing for a call or a put. Go ahead and do it if you think you have the time. Intraday trading is not for you if you have a day job and only want to look at the market once in a while.