What intraday trading tools you use while analyzing markets in a real-time environment?
Day trading is a risky business and so the margin of error is minimum. Moreover, you must know how intraday works.
You need to be very cautious before you place any trade.
Focus and discipline is the key thing that will make you stand out and makes you a winning trader from a losing trader.
I prefer to use price-action to analyze and predict probable movements and key levels.
In fact, I normally trade in Bank Nifty futures or options using these 4 best intraday trading tools to gauge the market sentiments and identify trends.
Intraday Trading Tools
1. Tradingview Charting Platform for Chart
2. TradingTick Features – Trending OI Strikes
3. TradingTick Features – CALL vs PUT Open Interest
4. Sensibull – Option Chain
I use the above tools to identify overall trends and the strongest support & resistance zone.
Finally, I use my price action trading strategy to enter into a trade.
However, before you use the above tools make sure you follow the 8 steps that’ll make you a profitable trader.
Step 1: Neutralize Your Mind
Before you start your day make sure your mind is neutral. That means you don’t need to analyze or predict market direction.
It is because you’ll be doing day trading.
Intraday trading is totally different then swing trading or a long-term investment. It is more like a T20 format in Cricket.
Do you know that market takes some time to shows its true color in a day?
So, it is always better to settle the market and let it form the trends. Furthermore, you don’t need to predict the market and instead just follow it.
If it started to go up, then go wherever it goes. The moment it changes its direction, you also need to adapt quickly and change your gear fast.
You cannot be rigid in such a volatile environment. So, neutralize your subconscious mind and keep yourself calm.
Step 2: Trade in a Distraction-Free Environment
Distraction is the main enemy of a day trader. So, you need to focus patiently while doing intraday trading.
Stress-free trading helps you to avoid impulse trading activity and eventually makes you a profitable trader.
So, do some yoga and meditation before you sit in front of the trading terminal.
Most importantly, avoid News, Mobile Phones, Social Media, or any other mode of distractions.
By avoiding all these can help you to neutralize your mind and you may take good profitable trades.
Step 3: Wait and Watch Like a Hawk
Once you are ready with step 1 and step 2, you can trade now.
Wait, wait Mr. Anderson……
Why you’re so keen to trade? You have to wait till the market settles down. As per my view, you need to wait for at least one hour after the market opens.
Do you know why?
Simple, it is because markets take a little bit of time to settle down and then started to forms trends.
Before you just hop into a trade, make sure you know the direction where the market is heading.
Till then wait and watch the market like a HAWK.
Step 4: Identify Market Trends Using Intraday Trading Tools
I use the 4 intraday trading tools that I have mentioned earlier to gauge the market sentiments and identify trends.
These tools help me to identify the key areas where markets may react strongly like support and resistance levels.
So, the first tool is the TradingView Charting platform which I used to analyze the candlestick chart. However, you can use any charting platform that is suitable for you.
I use it because it is very easy to use and has many technical analysis features.
The second tool is TradingTick Trending OI Strikes which helps me to identify the strongest and the weakest levels.
It helps me to figure out whether the Support losing its strength or is getting stronger as time passes.
So, I started to plan to enter near these crucial levels as the majority of trader’s sentiments are lying in these key areas.
Thirdly, I use again TradingTick one more technical analysis feature which is CALL vs PUT Open Interest.
These intraday trading tools let me find the undercurrent of the market. It helps me to avoid the trap set up by the Operators or Big Fish of the markets.
Sometimes, it happens that Bank Nifty is going up. However, the Total CALL Change in OI is more than the Total PUT Change in OI.
This actually signifies Bank Nifty likely to nose dive down. So, if your indicators or price action is showing that Bank Nifty is likely to go up but Change in Open Interest data is telling you some other story.
In this way, these tools always help me to avoid false breakouts in day trading.
Finally, I use Option Chain data of Sensibull only to gauge which strikes of options are getting stronger or weaker in numbers.
If the Change in OI numbers is increasing that means the particular strike or at that level entry can be done.
I combine all these 4 awesome tools with my price action trading strategy to finally enter into a trade.
Step 5: Find The Area of Value Using Day Trading Tools
As soon as you identify the trends, it’s time to mark the favorable zones or the area of value. I do that using trendlines along with horizontal support & resistance.
In addition to that, I also use trending option strikes of Bank Nifty. The Area of value is the high confluence area where trendlines, horizontal lines, and trending option strikes come and meet together.
You can find other ways to identify the high confluence zones as well. However, I prefer a price action trading strategy to find the area of value.
Step 6: Wait For Price Rejection
When you identify the area of value, then don’t just jump into the trade. You have come so far now and just a few more minutes of patience will reward you amazingly.
Wait for the price to show some kind of rejection near the area of value. You can find the price rejection by candlestick where you may notice larger wicks than the body of a candle.
A pattern like Hammer, Shooting Star, and Engulfing are a few candlesticks that signify trend reversal.
Step 7: Enter Into The Trade
Once you get the rejection sign near the area of value, then there is no look back.
It’s time for action and no more confusion. Just hit the trade button to Buy or Short.
After you trade, just go to step number 8.
Step 8: Set Target Profit and Stop Loss
As per your trade setup or your trading strategy just set the Take Profit and Stop Loss in your trading terminal.
No more guessing and don’t keep SL and Target in your mind. You have to set it in your broker platform. Finally, go out and just chill.
Let it hit either the Target profit or Stop Loss. If nothing happens, then close your trade just before the market close.
Bonus Step: Just Chill!
The final bonus step is to wait and see what happens.
No more adjustment.
No more tweaking SL or Target.
Just be yourself.
Now it’s time to call your honey!