The Art

The Art of Intraday trading is not just about the numbers and data’s, but something which is unquantifiable – an emotional biasness. These biasness creeps in while trading, and influences our decisions sometimes subtly, sometimes substantially. This is the main reason why successful day traders often exhibit exceptional emotional control and discipline.

If emotions are one side of the intraday trading, adaptability is the other side of the coin. How quickly we adapt to the various market movements is another skill that day traders need to develop in order to succeed and both these requires years of experiences.

The Science

Very unlike the art of trading, the numbers and data’s take are the core of the Science of Trading. The science of day trading involves the use of systematic and data-driven approach to trading. Almost all successful intraday traders use technical analysis to identify the possible trends and patterns.

Risk management is another fundamental element of the science of intraday trading.

The Lessons -I’ve Learnt

My observations and lessons, that I’ve learned from the experiences I would like to share with you.

• Importance of Research

A recent research report by SEBI states that 9 out of 10 individual traders faced losses in the F&O segment from FY19 to FY22. I believe that the primary reason for this is a lack of knowledge of how the derivative market works. Therefore, day traders must first spend a considerable amount of time to understand the mechanics and implications of the complex world of derivative market.

• Significance of Stop Loss Trades

The financial markets are constantly in a state of evolution & change. Despite being adequately prepared, the market movements sometimes can catch traders off-guard. That’s why a stop-loss is an essential part and a protection against such moves.

• Over-Leveraged Trades

When the loss is beyond our capacity to bear it tends to impact our psychology, and impacts in all our trades, therefore, knowing our own leverage and loss bearing capacity is very much important, to grow as a day trader over a long period of time.

Trading on high leverages can quickly lead to substantial losses even if the market moves slightly against us, thereby impacting our emotions. Remember, to succeed as a day trader, you not only require a high level of technical knowledge but also an in-depth understanding of human and market psychology.