Which Time Frame Chart is Best for Intraday Trading?
In India, the markets are open from 9:15 AM to 3:30 PM. The aim of an intraday trader is to find a favorable setup, take the trade and make an exit on the same day. For such a kind of trading, it’s very important to keep a close watch on the market trend and volatility. Markets keep fluctuating with news flows and a favorable trading opportunity might appear anytime.
The best time for intraday trading is therefore subjective. There are a few insights though with regards to certain timeframes that can be helpful. For example, the early session of the market between 9:30 AM to 10:30 AM shows the below features:
a) During this time, the liquidity of the market is higher, which provides an easy entry and exit in the stocks for intraday traders.
b) The volatility tends to be high in the early hours of the market and this plays a vital role in intraday trading.
Experienced traders usually like to make the most of the initial fifteen minutes of the market. If you are new to the market, it’s better to make observations initially before taking trading decisions.
Technical analysis plays a crucial role in intraday trading as it helps a trader to determine the entry and exit points and increases the chances of making possible profit. Usage of 5 minutes & 15 minutes chart is suitable if you are doing day trading. That way you can closely keep a track of the market trends. Furthermore, for a better understanding, you can analyzethe daily chart over different time frames to gauge the broader trend.
Best Candlestick Time Frame for Day Trading
Intraday trading is all about small price fluctuations, therefore traders prefer the 5-minute candle chart or the 15-minutes candle chart. The charts portray the trading activities of the last 5 and 15 minutes respectively based on which you’ll carry out your trading activity. Hourly charts may also give a glimpse of the broader market trend.
Intraday Trading Square-Off Time
By now we know that intraday positions can be held for only a day. Hence, it’s crucial that you square-off all your open intraday positions before the market closes for the day. The intraday open positions get squared off automatically if you fail to do so. The time for the intraday square-off usually ranges from 3:15 PM to 3:30 PM. So, make sure you’ve exited your current positions prior to that.
Conclusion
It’s important to be aware of the intraday trading time if you wish to make the most of the available time. Intraday traders generally prefer the early morning market hours due to the high volatility and liquidity. Even though there’s no thumb rule for that, still it’s crucial if you strategize and keep an eye on the best time.