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In the age of the Internet, trading has become fast and reliable. There are different types of financial assets and methods that you can use to trade. One of the shortest and most strategic forms of trading is intraday trading. Intraday means within the day, so as the name suggests, it is an approach that focuses on trading securities on the same day. The term ‘today’s high’ stock is quite common in intraday trading. Intraday trading also highlights the highs and lows of securities throughout the trading sessions.
Intraday price movement is particularly prevalent throughout the day. These price movements are one of the favourable types of trade for short-term traders. A trader can settle their position before the market closing hours. Intraday trading gives significant prominence to the new intraday highs and lows of the market. Consider an example of a new intraday high, which means the security reaches a new high relative to its performance on that day.
What Is Today’s High?
Today’s high is a security’s intraday highest trading price. This price is represented by the highest point on a day’s stock chart. You can differentiate this price by today’s low, which is basically the intraday low price. Today’s high answers several questions, including the stock’s trend, what news is driving the price that day, and what might be good entry and exit points for trades. It also reflects the asset’s future movement.
Most professional traders pay close attention to intraday price movement, where they use real-time charts and mark specific price changes in the stock market. The short-term trader typically looks for a 1-minute, 5-minute, or, at the most, 60-minute intraday candlesticks chart when trading in the stock market. Scalping is an intraday technique that involves executing trades in a fraction of the time and profiting from small movements in the stock price. A regular intraday trader may hold their position for a longer period in the hope of making better profits.
The Concept of Today’s High
As we understand it, today’s high ratio reflects the highest price at which stock is traded throughout the trading day. This is typically higher than the closing or equal to the opening price. These price ratios can also be used for calculating the moving average.
The major advantage of today’s highs is that traders and technical analysts use these highs and lows to figure out the accurate gap and sudden jump ups or downs in a stock’s price with the help of the gathered data.
Consider an example of ABC securities where the price is as low as ₹50 and the previous day’s high is ₹45. This indicates that there is a gap. To identify the gap along with other market signals, you can use the changes in trending volume and the overall bullish or bearish trend indication, which can be used to mark the buy or sell signals for particular stocks.
Importance of Today’s High
To evaluate the importance of today’s high, you can say that it serves as an indicator where the stock’s price, which has been trading, provides traders and investors with a golden opportunity and insight about the particular stock. There are several calculations or technical indicators that can help traders trade intraday.
Intraday High and Day Trading
Intraday price movement is closely linked to different factors. The practice of trading financial instruments on the same trading day is known as intraday or day trading. Many traders, such as bankers or institutional investors, perform day trades. However, with the increase in investors, day trading is on the rise, and people are taking massive advantage of it.
Although it’s not possible to locate the time of a stock’s high or low value, it is generally considered the best thing to avoid buying a stock at its daily high. If the investor tends to look for a long-term strategy, then buying and selling won’t make much difference. One of the major benefits of intraday trading is that the position of your trade remains unaffected by overnight news, which has a potential impact on the price. For example, suppose negative news, such as economic reports or earning reports, as well as broker upgrades or downgrades, are all done by the time the market closes. So, if you trade intraday, the impact of such things is avoided.
Trading on an intraday basis offers multiple other key advantages, including the ability to use accurate stop loss orders and increased leverage. In contrast, the disadvantages of intraday trading include insufficient time for a position to increase in profit and increased commission costs due to trades being taken more frequently.
Finding Today’s High on a Stock Chart
On a stock chart, you can see the price movement of a stock as a line graph, a candle, etc. You can set the display according to your liking. Today’s high can be easily identified on the line graph as the highest point on the daily chart. This point will represent the highest value that the stock price reached on that day.
Usually, day traders trade in stocks that have lots of movement and high liquidity. This type of stock gives investors more opportunities to change their position and profit from small movements in the stock price. If the price moves upward, the trader buys and sells the stock after reaching a certain limit. Whereas, if the stock price tends to fall, then traders sell the stock and save themselves from heavy losses.
Final Words
Now that you are aware of where to start your intraday journey, you can try it yourself. But before going ahead, you must make a proper roadmap and understand the ins and outs of intraday trading. In this way, you can minimise your losses and make better returns.
Trading on an intraday basis offers several other advantages. One of the advantages is the ability to use an accurate stop loss in order to act before it’s too late. Another benefit you can utilise is the increased margin and, hence, greater leverage. Intraday trading also provides the trader with more learning, practising, and trading opportunities.
But before you trade, you need to open a Demat and trading account. You can open a free Demat and trading account with Share India. It offers lots of features, including charts and indicators.