How to Decide Best Entry & Exit Points in Intraday Trading?

 

Intraday Trading also known as Day Trading is the one-day game in which you have to buy and sell or vice-versa on the same day before market close. Intraday trading is not easy, especially for inexperienced traders who find it difficult to select the right stocks or don’t know where to enter into trade and exit timely.

Also Read: How to Do Intraday Trading: Best Stocks, Charts & Strategies

Entering and exiting at the right points in intraday trading is one of the most crucial decisions to make your day trading successful. Today in this article we will tell you how you can decide the entry and exit points in intraday trading.

What are the Entry and Exit Points in the Trading or Day Trading?

In long trade positions or buying, the entry point is the best possible level at which you should buy the stock so that there are fewer chances of hitting the stop loss and there is a possibility of movement in the stock to give you some profits.

Conversely, the exit points in the buying are the level at which the stock doesn’t have the potential to move further or can turn back. For short-selling the exit point would be at the support levels where you book the profits or when your stop loss is triggered and that would be above your selling point.

In intraday trading identifying the right levels of entering and exiting from trade positions and making quick decisions for buying and selling is the key to making your trade successful. Hence let’s find out such crucial points.

How to Identify Entry and Exit Points in Intraday Trading?

If you entered into the trade position at the right point and managed to book the profits at the right levels, then you can make money from day trading or such short-term trading practices. Hence, identifying the right exit and entry point is very important to make the intraday trading strategies successful.

Top 10 Best Entry and Exit Strategies for Day Trading:

Use the Technical Indicators

An intraday trader can use various technical tools and indicator for finding entry and exit points on smaller time frame charts. A trader can use technical indicators like RSI, Moving Averages or MACD and other oscillators. Along with telling you the current trend, these indicators will also help you in identifying the right level of buying and selling with the maximum possibility of getting returns.

Also Read: How To Use Best Moving Averages for Intraday or Day Trading

Buy the Trending Stocks

The stock-in trend will give you the opportunity to enter any level as the trend is likely to continue. But you need to make sure of the strength of the trend and you can take this opportunity in the early trading hours to get some room for booking the profits. The trend might continue for the next day, but you can exit intraday.

Also Read: How to Find Trending Stocks for Intraday Trading: Ten Rules

Sell the Weak Stocks

On the selling side if you want to enter into short-selling you can choose to sell the stock weak on the day, which means when it’sin the downtrend. In early trading hours, or as soon as the market opens, you can sell the stock and owing to a downtrend when the price decreases further, then you can book the profits where no further movement is visible.

Enter Above the Breakouts

The breakout and breakdowns are some of the best points to enter into the trade positions. When a stock is trading in range and turnaround from the resistance levels means the sellers are dominating at this point.

Also Read: What is Breakout & Breakdown How to Identify Breakout in Stocks

But when buyers are dominant and the stock breaks this resistance level and comes out from this trajectory, you can buy or go long at this point. Breakouts are one of best points to enter into long positions with potential of further upside.

Short Below the Supports

Just like breakouts at the upper side, at the downside when stock breaks down the support levels, you can enter into a short-selling position at this point. The support levels work when the stock stops falling further due to buyers jumping into the market, but sometimes, sellers take the grip and override the downside movement breaking the support levels. This breakdown is a good point for selling the stock as it can move further.

At the Trend Reversal Points

The trend reversal point is another useful point where you can enter or exit from your trade position in day trading. When a stock is moving in a single direction say uptrend but when the trend is reversed and the downtrend starts you can exit from your long position or book the profits or you can enter into short-selling positions.

Also Read: What are the Best and most Accurate Trend Reversal Indicators

Similarly, when a downfall in a stock ends and it goes through sideways momentum depending upon the steepness of fall, that time you can exit from your short position or enter into a long position. To identify the trend reversal you can use the candlestick chart formation and to confirm the trend reversal you can use the popular technical indicators that you can find or apply in TradingView.

Also Read: Which Candlestick Pattern is Most Reliable for Trend Reversal

Book Profits at Resistance

I think we have already discussed this point but let me tell you how you can use the resistances in the stock prices for intraday trading. Usually, at the resistance levels the stock in an upward direction stops and comes down, so you can use this point to book the profits in your long positions.

Also Read: Support and Resistance: How to Find Support & Resistance