Should I trade in the first fifteen minutes?
The initial 15 minutes of the trading session—from 9:15 AM to 9:30 AM—are typically the most volatile. During this window, prices swing sharply as the market digests overnight developments, global cues, and pre-market orders. For instance, if Company X releases strong earnings before market open, its stock might surge quickly. While seasoned traders may capitalize on this volatility, beginners are better off observing market trends before jumping in.
Types of intraday trading charts
Intraday trading charts shows the price movement between the opening and closing bells of a daily trading session. Here are some of the charts:
Chart Type
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Time Frame
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Use Case
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Hourly Charts
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1-hour intervals
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Best for identifying long-term intraday trends and planning entry/exit.
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15-Minute Charts
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15-minute intervals
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Suitable for short-term trend analysis and quick trading decisions.
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5-Minute Charts
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5-minute intervals
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Helps in identifying rapid price movements and short-term reversals.
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2-Minute Charts
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2-minute intervals
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Ideal for scalpers who need real-time trend signals.
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1-Minute Charts
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1-minute intervals
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Used for ultra-fast trades; gives immediate entry and exit cues.
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Significance of intraday trading charts
Intraday trading charts help traders spot trends, price movements, and volume changes within a specific stock during the trading session. By analysing these charts, traders can make timely decisions, choose optimal entry and exit points, and reduce the risk of losses through real-time data insights.
Intraday trading time for commodities
In India, the commodity market opens at 9 am and closes at 11.30 pm. The market is closed on Saturdays and Sundays, and on holidays declared by the exchange in advance.
Commodity traders can choose the timing of intraday trading at their convenience. However, they must focus on a few commodities because every commodity has unique influencing factors..
Traders must keep track of domestic and international factors that influence the price of these commodities. Certain commodities share both positive and negative correlations with various assets. For example, gold has a negative correlation with the US Dollar, i.e., when the price of gold increases, the value of the US Dollar declines.
Furthermore, traders of agricultural commodities must be aware of information related to weather forecasts.
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Optimal time frames for Intraday trading success
The most favourable window for intraday trading, as per stock market analysts, is between 10:15 AM and 2:30 PM. This is because the early morning volatility typically settles by around 10:00 to 10:15 AM, making it a more stable and strategic time to initiate intraday trades.
Intraday traders should avoid trading for the entire day because they might not be able to get sufficient rewards. Experienced traders have frequently lost money or received lower returns after trading all day long.
The first one-two hour after the stock market opens is the ideal time for intraday trading. While experienced traders can start intraday trading at 9.15 am, beginners should wait until 9.30 am. It is because, during the first fifteen minutes, stock prices get affected by the previous day’s news.
Trading at the opening of the market
Volatility can be a double-edged sword for beginners. While the first hour offers:
- Ample opportunities: The initial price swings can present good entry and exit points for trades.
- High liquidity: Stocks are actively traded, making it easier to buy and sell quickly.
- Potentially larger gains: Some of the biggest daily price movements happen in this window.
However, there are also risks:
- Misleading volatility: Early price swings can be fueled by ‘dumb money’ reacting to overnight news, not reflecting the actual market trend.
- High risk, high reward: The potential for large gains comes with the potential for significant losses.
- Time constraints: Exiting positions before the market closes (3:30 PM) becomes more challenging after 11 AM.
Therefore, for beginners, it's safer to wait until 9:30 AM when the market settles. However, experienced traders might find the 9:30 AM to 10:30 AM window ideal due to the volatility and liquidity.
Remember, success depends on your skill level and risk tolerance.
Intraday trading square off time
All open positions in intraday trading must be squared off by 3:20 pm. If it is an automatic square-off, there will be a charge of Rs. 50 + GST per position. The experts advise planning the square-off for open positions in advance.
How to start trading in India?
To start trading in India, people must create a Demat and trading account with a Depository Participant (DP). A bank account, a Demat account and a trading account are necessary for trading with stocks and other securities.
First, an individual opens an account in the trading platform of their choice. Next, he/she needs to link a bank account and a Demat account to the platform to receive/send money and securities, respectively.
Conclusion
A Demat account is where stocks remain stored. A trading account is mandatory because one needs it to place buy/sell orders with the stock exchange. Traders buy and sell stocks on the same day in intraday trading. While knowing the correct details of intraday trading time is a must, traders should take measures such as stop-losses to protect their capital. It is important to note that day trading in a volatile market is generally a bad idea. The ideal time for intraday trading is when one can predict the market's direction and momentum.
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