How to Choose Stocks for Intraday

How to choose stocks for intraday trading is one of the most important questions every new trader asks. Intraday trading means buying and selling stocks on the same day to make quick profits. But the key to success is picking the right stocks. Without a proper plan, you may lose more than you gain.

This guide will explain how to select stocks for intraday trading with simple steps and expert recommendations.Whether you are just starting or have some experience, these methods can help you better understand how traders identify suitable stocks for intraday trading.

Key Factors to Consider for Intraday Stock Selection

Choosing the right stock is the first and most important step in intraday trading. The stock you pick can make or break your day. Some of the key factors that influence the stock’s performance are as follows.

1. High Liquidity

Stocks with high liquidity are easier to buy and sell quickly without causing large price changes. This is typically reflected in higher trading volumes.

• High liquidity means smaller spreads (the difference between buy and sell price).
• It helps you enter and exit trades easily.

2. Volatility

For selecting stocks for intraday trading, volatility is essential. You need stocks that move well within the day, as the traders will benefit from price movements during the trading session, when prices move up or down as per their expectations.

However prices can also move in the opposite direction and lead to losses. While some volatility helps create trading opportunities, very high volatility can increase risk due to sudden and sharp price swings.

3. Market News and Events

News can strongly impact stock prices in intraday trading.

• Check for earnings reports, government announcements, or industry news.
• Stocks in the news often have more activity.
  (You can check for all stocks in the news along with their sentiment impact using Tradomate’s News feature)

4. Sector Trends

Keep an eye out for sector trends because certain sectors may perform better responding more strongly to local or global developments.

For example:

• Tech stocks might boom during innovation announcements.
• Energy stocks may react to oil price changes.

5.Technical Analysis

Technical analysis studies trading volumes and past prices to understand a stock’s behaviour. Using technical analysis a trader can look at chart patterns, support and resistance levels, and trends, to select right stocks.

6. Use an Intraday Stock Screener

A good screener can help you filter stocks by volume, price movement, sentiment and more.

At Tradomate, our AI-powered screener simplifies the stock screening process by allowing users to define screening conditions in natural language. It combines technical filters with integrated sentiment analysis, making it easier to evaluate stocks more comprehensively

Note 1 : You can also use our news page to identify stocks with fresh, high-impact news so you can account for sudden volatility.

Note 2 : Also use alerts to notify you when a setup triggers, helping you avoid late entries.

Note 3 : Analyzing a stock’s past performance can reveal its usual trends and behavior during trading periods. You can gain this in-depth understanding through Screener Backtesting only on Tradomate

By using Tradomate, you can trade with confidence, knowing your decisions are data-driven.

7. Gift Nifty

Additionally, you can also keep an eye on the GIFT Nifty movement from the previous day to understand the overall market sentiment. If GIFT Nifty trends upward, it usually indicates a positive start for Indian equities, while a downward trend may signal a weaker opening.

8. Open Interest

Additionally, monitor Open Interest (OI) data for futures and options. Rising OI along with increasing prices suggests strong buying interest, while rising OI with falling prices shows selling pressure. And a drop in OI shows that traders are closing their positions.

They all help traders understand market sentiment, spot possible reversals early, and make smarter intraday decisions based on real-time market activity.

Common Mistakes in Intraday Stock Selection

Here are some pitfalls to avoid:

• Ignoring Volume: Don’t trade stocks with low volume. You might not be able to sell when you want.
• Chasing Hot Tips: Following random stocks without research often leads to losses.
• Emotional Trading: Not following or discarding the strategy midway due to emotions can lead to poor outcomes
• Ignoring Market Trends: Ignoring market direction or key economic signals can cause intraday traders to take poor or ill-informed decisions.

Final Few Words

Learning how to choose stocks for intraday trading is about patience, practice, and the right tools. Focus on high liquidity, volatility, news impact, and solid technical patterns. Use screeners on platforms like Tradomate to save time and get precise results.

Avoid common mistakes like chasing tips or emotional trading. Instead, prepare a good strategy based on in-depth backtesting and have a proper risk management plan in place. Stay disciplined, and use the right resources to improve your trading day by day.

To know more, explore Tradomate’s expert blog section!