Criteria for Choosing Intraday Stocks

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Intraday trading has become popular over the past years. It has gained popularity for providing rewarding returns in a day. However, reality depicts a different picture. In the real world, various factors come into play to get success in intraday trading. One such important factor is selecting the right kind of stocks. Choosing the right kind of stocks while investing has a significant impact on the investing experience and investing outcome.

Intraday Trading

Intraday stocks allow investors the opportunity to grab onto market price shifts making them very popular among day traders. Traders actively monitor market trends and news events that may impact stock prices. Intraday traders keep a close eye on company news, economic reports, and corporate earnings releases, as these events can cause significant price movements and create intraday trading opportunities. Intraday stocks offer short-term trading opportunities for investors looking to capitalise on price movements within the same trading day. Investors can optimise their intraday trading strategies by carefully assessing price movements and market conditions to select the most suitable intraday stocks.

Traders need to stay alert and attentive to market movements throughout the trading day, ready to act on trading opportunities as they arise. Identifying the best intraday stocks is essential for successful day trading and maximising profits. As the market landscape can change rapidly, traders must adapt and be prepared to adjust their strategies accordingly. Here are some unique considerations that can set traders apart and enhance their success.

  • Market Sentiment Analysis
  • Scalping Opportunities
  • After-Hours Trading
  • Overnight Risk Management
  • Statistical Analysis

Defining Intraday Trading

Intraday refers to a trading strategy that involves purchasing and selling stocks on the same day. The motive here is to benefit from stock price performance on that day. A trader cancels his open position before the trading session ends and does not take delivery of the assets overnight. Intraday trading is on the rise due to the growth of Demat accounts. The total number of day traders has gone up drastically in the last few years.

Intraday trading can be done using many kinds of instruments like cash, gold, stock, or exchange-traded funds (ETFs). Intraday trading is also helpful to eliminate the risk associated with a stock within 24 hours. However, intraday trading carries its own set of risks. The prominent risk factors while trading include negative market-related news and volatility in stock prices. In addition, there are many factors that affect the performance of stocks of day traders. 

Selecting Stocks For Intraday Trading

Volatility and liquidity should be the top priorities when selecting stocks. Other elements like the market cycle and price movements are highlighted in the news. Analytical trade setup facilitates when monitoring the market level. One can track the stock prices meticulously as they go up high or low. One may compile a list of the top stocks for intraday trading using indicators like Average True Rate (ATR) and standard deviations. It can be used for a certain time period, such as the last fifty or hundred days.

The three-month moving average can be used to identify the most liquid stocks. Banks, institutional investors, and the general public follow the Nifty Index to look out for actively traded stocks that have decent stability in the market. 

Factors To Consider While Picking Stocks For Intraday Trading

Traders need to consider the following factors before starting intraday trading.

  • Corporate Event

Whether trades are made on the basis of a technical arrangement or not, it is prudent to check to see if the company has a corporate programmed timetable. Regular checkups are necessary. These corporate events can bring various kinds of problems and possibilities. 

  • Volatility and Liquidity

Volatility and liquidity are essential for intraday trading. High volatility means rapid fluctuations in the stock price within a short period of time. Low volatility means that the stock price is relatively stable. Since liquidity is essential for daytime entrance and exit, volatility should not come at its expense. Highly unstable and lightly traded equities are usually avoided by traders. Stocks with a record of turbulent trading and high volume should be chosen as trading options. It is better to trade that way rather than viewing the pattern of volatility in the context of a certain day or week.

  • Technical Analysis

Use technical analysis tools and indicators to identify entry and exit points. Common indicators like moving averages, Relative Strength Index (RSI), MACD, and Bollinger Bands can help in understanding the stock’s price patterns and momentum.

  • Market Trends and Sentiments

Analyse the overall market trend and investor sentiments. It’s generally easier to trade in the direction of the prevailing trend to increase the probability of successful trades.

  • Risk Management

Have a clear risk management strategy in place. Determine the stop loss and target profit levels before entering a trade. This will help manage risk and avoid significant losses.

  • Time of Day

Be aware that certain times of the trading day might offer better opportunities. The opening and closing hours often see increased volatility, while the midday period might experience lower activity. Traders seeking growth opportunities should focus on researching and investing in intraday stocks.

Traders can occasionally become stale on one side of the deal because of the limitation of liquidity. The difference between the bid and price affects the trading cost. When selecting equities for intraday trading, a trader should concentrate on volatility and liquidity. Indicators such as ATR and standard deviations can be used to compare the trading stocks.

Stocks and ETFs For Day Trading

For day trading, stocks and exchange-traded funds (ETFs) are popular choices due to their liquidity and volatility. 

  • Stocks represent ownership in individual companies and can offer significant price fluctuations within a single trading day, presenting opportunities for quick profits. 
  • ETFs, on the other hand, are investment funds that trade on stock exchanges and track various assets, such as stocks, commodities, or bonds. 
  • They provide diversification across multiple securities and can be traded throughout the day like individual stocks. 
  • Both stocks and ETFs require careful analysis of market trends, technical indicators, and news catalysts to capitalize on short-term price movements effectively.
  • Successful day trading with stocks and ETFs involves disciplined risk management, precise entry and exit strategies, and continuous monitoring of market conditions.
  • Intraday trading indicators can help one make more informed trading decisions.


Keep in mind that choosing the right kind of stocks is a crucial factor in intraday trading. While the aforementioned advice can assist one in finding them, over time one will learn which methods of stock selection suit one the most. In order to gain success in intraday trading, be sure to maintain objectivity, rely on statistics, and refrain from making emotional judgments.

Frequently Asked Questions (FAQs)