Intraday trading is all about purchasing and selling stocks on the same day. This happens during the stipulated trading hours prescribed by the stock exchanges. Shares are typically purchased and sold in large numbers to book profits in the day.
Intraday trading depends on the daily chart's instrument, which represents the price movement of the stock on a one-day interval. However, for the granular traders, there are other charts available such as hourly charts, minutes charts, and tick-by-tick charts. Do you know time matters the most in day trading?
Hourly charts are broken into hourly segments, and the high, low, and median price plotted for each of these hourly breaks. These are useful for identifying time-specific trends.
The 15-minute charts, on the other hand, are plotted over three to four hours. The only difference here is the stock price is broken into 15-minute segments. They are useful in determining short-term trends.
The 5-minute and 2-minute charts are where the trading analysis could range anywhere between a few hours to a few trading sessions. They are handy for traders who hold extremely short-term opportunities and work best for highly liquid stocks.
