How to Select/Choose Stocks for Day Trading?

Day trading or Intraday trading is an act of buying and selling a financial instrument within a day. Or even multiple times on the same day. Day traders intend to take advantage of small price movements. Historically Day trading is an institutional practice. Because financial institutions can use sophisticated tools and have the liberty to leverage their transactions in order to boost profitability.

To succeed as a Day trader it is important to identify the right stocks. In order to do so, A trader has to look for certain characteristics in a stock. Here are some tips that will help a trader to select stocks for intraday trading.

  1. Trade in Liquid stocks as they improve the probability of quick trade execution
  2. Choose the stocks that follow the group trends. In other words when the index or the sector of the concerned stock ticks upward, The indivisual stock price should also be incresead and Viceversa.
  3. Choose medium to high volatile stocks. Avoid trading the stocks which move less that 3% in a day. As intraday succes depends on the price moves.

How to Choose Stocks for Day Trading

1. Top Gainers and Loosers

The most profitable and Basic way of trading is to trade with the trend. The best way to choose stocks for day trading with the strongest of uptrends and downtrends is to look at the top gainers and losers section provided by NSE. NSE lists outs the top gainers and losses stocks according to the previous trading session. As Day traders you should look to trade in these stocks.


2. Use Trendlines

Trendlines are important tools for every kind of trader. A trendline can help a trader identify dynamic support and resistance levels. For a day Trader, a trendline is a simple visual representation of potential price waves. Choose stocks for day trading that Respect trendlines and to take a long position wait for a pullback or a dynamic support level to time your entry. And for a short position wait for the price to reach a dynamic resistance level. or Wait for a trendline breakout.

Example of hoe to use trend lines to select stocks for day trading

3. Be Paitent in the Pause

Markets don’t always trend. In other words, If major highs and lows are not being made, and the Prices are moving into small consolidated zones, the Market is not following a particular trend. In conclusion, in these types of markets, the potential reward does not exceed the risk involved. in my opinion, Day traders should choose these stocks. wait for the market to respect a trend, Use technical indicators, and most importantly chart patterns to analyze breakouts and catch them.

Day trading strategy for when market consolidates


In conclusion, Identifying the right stocks for Day trading is all about isolating the current market trend from the surrounding¬†noise. However, it is not necessary that a trader will come across stocks like this every day. This is why it is important to be patient in the market. there are many ways of trading, and none work every time. However, studying trendlines and Chart patterns can help a trader be consistent, If the conditions aren’t providing a good environment for deploying your strategies, DON’T, rather try to save your precious capital.


  • Tricia Scone is a Trading and Investing Enthusiast and has trained thousands of people in various complex courses of finance. She has a unique way of providing Complex Financial knowledge in simpler words. which is why she is regarded as one of the most popular finance coaches in the world.

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