As an intraday trader, how do you determine trend?

https://www.quora.com/As-an-intraday-trader-how-do-you-determine-trend

As an intraday trader, how do you determine trend?

Sukhesh, Trading from the last 4 years

Answered 1h ago

Thanks for A2A.

There is a popular saying in day trading.

“ Trend is your friend”

As an intraday trader, finding the trend is very important. Without identifying the trend, trading becomes somewhat similar to gambling which I used to do during my initial stages of trading.

So coming back to the question, we are now lucky enough to have so many indicators which does half of the work for us. But nothing beats price action which you can learn only from proper training and/or more and more observations. There is a misconception that chart reading is boring. But every candle tells you a story. Once you understand it, charts are never boring. Now a days, there are advanced charting tools which makes the chart reading more interesting.

When it comes to me, I trust price action morethan any indicator. That doesn't mean that I don't use indicators. Most of the indicators are lagging and you can't take correct decision always using any particular indicator.

Enough of beating around the bush. I will come straight to the point.

This is the step by step process I follow for taking any trade.

• I will choose a stock with a good volume and liquidity.

The order not getting triggered due to price jump and not able to exit due to lack of buyers/sellers is the worst thing that can happen in intraday trading. So finding a stock with good volume and liquidity is absolutely necessary. I have several criterias to select stocks which can probably give nice movements.

• I will try to find the trend of the stock using price action and combination of indicators.

For this, I use my chart reading experience and find possible bullish/bearish patterns in the stocks I have selected. For further confirmation, I use combination of indicators. The following are the indicators I use, but as a combination and not separately.

• Moving averages (both exponential and simple with different settings)
• MACD
• Parabolic sar
• RSI
• Pivot lines
• Volume (this is the most important one)

I am not saying that these are the only indicators that can be used for trend analysis. I am using these as I found them useful for my style of trading.

• Then I look at nifty chart for additional confirmation.

You can select the best of the stocks and put in your best indicators and price action experience in place, but when nifty moves against you, there is nothing much you can do about it. Either the stock you are trading reverses the trend or it starts moving sideways. Both of which are equally irritating. So I consider nifty chart for additional confirmation.

• Then I wait for breakouts with a good volume.

Volume is the king.

Even with the best of the indicators and price action, if there is no volume, it may turn out to be a false breakout. With volume observation, you can dodge false breakouts.

• I then set my stop loss and enjoy the ride once the breakout happens.

I never increase my stop loss if the stock moves towards it. But once stock starts moving in direction, I will start trailing my stop loss for minimising my loss as the stock may turn against me at any moment. Like this I try to enjoy the whole movement of the stock until my trailing stop loss gets hit. For this I use my own stop loss trailing techniques.

Hope you got a scenario of how I do day trading.

I broadcast all my observations on my telegram channel where you can observe them for your educational purposes and ping me personally for any doubts and info on trainings.

Here is the link to it.

Trade Bulls

Happy trading…