Different people use different types of Strategy for Trading in Intraday Market. The technical analysis is an important tool for analyzing the price movements of Stocks in the Stock Market. The concept of trend and supports and resistances are at the core of the technical analysis.
The support is a point at which the market approach from the top and reverse back after touching the levels. Similarly the resistance is the price level at which the market approach from the bottom and touch the level and again reverse and go down. The traders put the buy call at supports and sell calls at resistances.
At the support there are chances that the market will reverse and go up and at the resistances the market is anticipated to go down. Thus the supports and resistances can be used to determine the levels at which appropriate buy and sell calls can be placed. In case of Intraday Trading the previous day’s high and low can be taken as resistance and support for the next day.
The support and resistances can be traded with the help of candle stick patterns. If the candle sticks patterns showing the trend reversals are formed near supports and resistances. For example if a doji Candle is formed near the support there are high chances that the trend will reverse. Similarly if the trend reversal candle sticks are formed near resistances there are high chances that the trend will reverse.
The concept of trend is also important in day trading. The trader should always follow the current trend. The trader should trade with the trend and not against the trend. The Advisory Firms like CAPITAL BUILDER FINANCIAL SERVICES also use the above tactics to generate Stock market Tips. Accurate Intraday trading tips and Equity Tips can be generated using the above mentioned strategies.
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