Best Time Slots for Intraday Trading

so what is the best time slot for doing intraday trading right this is one question which is asked by almost every beginner and i myself you know i have experimented with different time slots different strategies and i thought why not i make a video about this topic where i can share my experience share my knowledge so that all of you can benefit from that right so that is exactly what we will do in this particular video now before we talk about the best time slots for intraday trading we have to break down the market hours into some logical parts so as you guys know that the equity markets are open from nine o'clock in the morning till four o'clock in the evening 9 15 to 3 30 are called regular trading hours and the time slot from 3 40 till 4 o'clock is called post market hours now if you don't know what is free market or post market don't worry we have made dedicated videos for each of these topics so just go and watch them and i'm sure you will figure out what they are all about now coming to the regular trading hours we can also break them down into some logical groups so that it will make a little bit more sense and i will explain them later as we go along and one more thing in trading lingo this time slot is called the first half and this time is called the second hour well just so that you guys are aware what first half and second basically so now that we have broken down the market hours into these logical time frames it's time for us to talk about which time frames are not good for doing intraday trading and the first thing first that you guys need to remember is that both pre market and post market are absolutely not recommended for doing intraday trading now the exact reason for that has already explained in the videos that i talked about but short point number one this lack of liquidity there is not enough trading volume there and number two in both the circumstances you can only enter into the trade you cannot exit out of that trade right so for intraday trading you have to enter and exit in that same trading session right so that's the reason why i will not recommend you to do trading in pre-market and post market hours now the next time start which is i think the most dangerous time slot for intraday traders is 9 15 till 9 30 right so the first 15 minutes are very dangerous why because this is the time when volatility can be very very high because the price discovery is going on all these market participants they are placing their orders you know there is a lot of buying selling the prices can easily go up one or two percent up or come down one or two percent so the probability of your stop-loss hitting during this time is very very high and this is especially most dangerous for option traders right now the second thing that i have observed when it comes to this time frame is that a lot of retail traders we get very excited right so we have been thinking about you know what kind of trades we will take and then we are all ready we have excited so as soon as the market opens we have a tendency to just go and buy something or sell something and what happens is that more often than not for us you know we take a trade mostly those trades do not work out because of the volatility and other factors and once you incur a loss right in the morning what do you think the trading psychology will be for the rest of the day well you will keep trying to recover from those losses and in the attempt of recovering from those losses we tend to make even bigger mistakes right so it's not a very good idea for jumping right in the beginning taking a big loss and then for the rest of the day we are trying to dig deeper and deeper to come out of this hole right that is the reason why i will strongly recommend you to avoid trading in the first 15 minutes now the next very important time slot which i will recommend you not to trade is from 3 o'clock till 3 30 and there is a very good technical reason for that so what happens is that with most of the brokers they will not allow you to carry your intraday orders beyond 3 10 or 3 15 right so if you take a trade at let's say three o'clock you barely have 10 minutes or 15 minutes for your trade to work out and if it doesn't then you will be forced to cut that position and you will be forced to come out of that so because of the time limitation i will recommend you to not take a trade in this last half an hour now the next time slot which i will not recommend all of you guys to trade is half an hour before the european markets open right now european markets they usually open at either 12 30 or 1 30 depending on the daylight saving right and the reason why we should not be taking a trade just before the european markets open is because let's say for example you have a long side buy a set you want to buy something in the anticipation that the market will go up or the stock will go up but what can happen is that if there is some negative sentiment across the globe and the european markets they open lower and they start falling as soon as they open then your long position can get into trouble right so only after you have seen how the european markets are doing it is a good idea for you to take a directional trade after that time right so now we have talked about a lot of time slots that we should be avoiding right but does it mean that the rest of the time sort that we did not talk about they are ideal for doing interacting well that depends on the strategy that you want to use right so let me go one by one if you are looking for trading momentum based strategy side where you are looking for breakout to happen or break down to happen you are basically expecting a big movement in the stock of the index then the ideal time slots based on my experience are either 9 30 to 10 30 or from 1 30 to 3 o'clock because ah the first morning hours is a time when a lot of retail traders are active so there is a momentum because of them and in the last hour there is a lot of institutional activity because of which there can be some serious momentum so both of them are good time slots for momentum based strategies the next kind of strategy is the mean reversion strategy right now what exactly is mean reversible mean reversion basically means that if something has gone up a lot it is quite normal for it to come back to its mean right in a similar way let's say the market has fallen down let's say the first one or two hours it's very much possible for you to give you a pullback so if you want to deploy a mean reversion strategy then in my experience the time slots between 10 30 to 130 they work very well for mean reversion kind of strategies now the third kind of strategies are gap based strategies right so let's say there is a big gap up or a big gap down and you want to either buy or you want to sell at that time now by the very nature of gaps if you want to trade a gap either go along with it or go against it you basically have the first 15 minutes right so 9 15 and to 9 30 that is basically the time that you have to trade a gap-based strategy which as i have already discussed is not really a good time for us to trade given the enhanced volatility right but then there are traders out there who are experienced who know how to handle volatility so for you guys who know what you're doing you know this time slot is fine just keep your position sizes small so that in case you are wrong you are not going to incur a big loss now the next kind of strategy which is one of my favorite strategies is expiry day strategy right so expiry strategy for those of you guys don't know uh this is when basically option sellers they sell options we actually have made a video on this topic of several bunch of videos you might want to check them out so expiry day strategies they normally work on wednesdays and thursdays for nifty and bank nifty for fin nifty it would work on tuesdays but as of now there is not enough liquidity there so for expiratory strategies the ideal time slot is pretty wide actually right so what i do normally is that when i am trading expiry days i start selling from 9 30 of the options and i tried to wrap up my trade by around 130 and in the worst case scenario about 230 right but beyond 230 i am extremely careful because there can be some very high volatility on expiry days and whatever profits that we have made in the first half can easily vanish right in front of our eyesight so that is something to keep in mind if you want to do expiry day strategies now the next kind of strategy which is again very common is event based strategies right so whenever let's say there is a big event let's say you know budget or rbi or election or anything that we know which is coming and which can potentially move the market so if you have a strategy that you want to use on this event kind of days then first of all you need to know exactly when that event is happening right otherwise it's very very hard for you to time it and then even for an event you have to break down the day into two parts pre-event and post event so my strategies for example i i do not trade before any event because i know that before the event there can be some speculation sometimes the market can make erratic moves they are not very reliable so what i like to do is that if i have event-based strategies which i do for taking advantage of volatility i wait for the event to be out and after the event is out i give let's say another you know 10 15 minutes and then i take a trade based on uh based on the situation at that point of time so if you want to do any event based strategy then you need to know the exact time and you need to have a clarity of exactly what do you want to do before the event or after the event but in any case you should never be taking a trade through the event means don't carry a position when that event is actually happening right so that's how you should plan for your event-based strategies now there are a couple of other strategies that we really do not have a lot of time to talk about number one is scalping strategies and the other is arbitrage strategies right now scalping is a very broad term it's not just one strategy scalping has several different strategies because depending on what exactly you you are trying to scale right so if you are let's say scalping momentum then you have to go with the time slots that we talked about 9 30 to 10 30 and then 1 30 to 3 o'clock that's when the momentum is the highest or if you are trading uh based on some key levels then scalping can work very best if you are doing mean reversion based states right so for that 10 30 to 130 happens to be a good time slot and then there are other ways in which scalping can be done which are not very much dependent on the timing because scalping is a very short duration right so you don't need to stay in the trade for very long time so it doesn't really get impacted a lot but then again you need to know what you are doing otherwise you can make some expensive mistakes arbitrage type of strategies they are also independent of the market hours because when you are trading in arbitrage strategy you have to take the trade when there is an arbitrage opportunity right so you don't know exactly when it might appear it might appear in the morning it might appear in the midday or it might appear in the second half so whenever it happens you need to be ready for taking advantage of that you know that opportunity but in my experience uh for arbitrage kind of a strategy it's becoming hard for retail traders to find those kind of opportunities and especially given that you know there are so many algos that are in the play you know you you really want to take advantage of that you basically have to carry the position for several days right and that of course is not part of the intraday um trading so that is the reason why i will not encourage you to do a lot of in arbitrage kind of intraday trading so guys that is basically what i wanted to share in this video i mean there are so many other things to talk about in this topic there are so many different strategies out there that i can talk about but again we have to limit the video to a certain time period but i hope that this video would have given you a perspective of how to approach intraday trading as far as the timing is concerned

so what is the best time slot for doing intraday trading right this is one question which is asked by almost every beginner and i myself you know i have experimented with different time slots different strategies and i thought why not i make a video about this topic where i can share my experience share my knowledge so that all of you can benefit from that right so that is exactly what we will do in this particular video now before we talk about the best time slots for intraday trading we have to break down the market hours into some logical parts so as you guys know that the equity markets are open from nine o&#39;clock in the morning till four o&#39;clock in the evening 9 15 to 3 30 are called regular trading hours and the time slot from 3 40 till 4 o&#39;clock is called post market hours now if you don&#39;t know what is free market or post market don&#39;t worry we have made dedicated videos for each of these topics so just go and watch them and i&#39;m sure you will figure out what they are all about now coming to the regular trading hours we can also break them down into some logical groups so that it will make a little bit more sense and i will explain them later as we go along and one more thing in trading lingo this time slot is called the first half and this time is called the second hour well just so that you guys are aware what first half and second basically so now that we have broken down the market hours into these logical time frames it&#39;s time for us to talk about which time frames are not good for doing intraday trading and the first thing first that you guys need to remember is that both pre market and post market are absolutely not recommended for doing intraday trading now the exact reason for that has already explained in the videos that i talked about but short point number one this lack of liquidity there is not enough trading volume there and number two in both the circumstances you can only enter into the trade you cannot exit out of that trade right so for intraday trading you have to enter and exit in that same trading session right so that&#39;s the reason why i will not recommend you to do trading in pre-market and post market hours now the next time start which is i think the most dangerous time slot for intraday traders is 9 15 till 9 30 right so the first 15 minutes are very dangerous why because this is the time when volatility can be very very high because the price discovery is going on all these market participants they are placing their orders you know there is a lot of buying selling the prices can easily go up one or two percent up or come down one or two percent so the probability of your stop-loss hitting during this time is very very high and this is especially most dangerous for option traders right now the second thing that i have observed when it comes to this time frame is that a lot of retail traders we get very excited right so we have been thinking about you know what kind of trades we will take and then we are all ready we have excited so as soon as the market opens we have a tendency to just go and buy something or sell something and what happens is that more often than not for us you know we take a trade mostly those trades do not work out because of the volatility and other factors and once you incur a loss right in the morning what do you think the trading psychology will be for the rest of the day well you will keep trying to recover from those losses and in the attempt of recovering from those losses we tend to make even bigger mistakes right so it&#39;s not a very good idea for jumping right in the beginning taking a big loss and then for the rest of the day we are trying to dig deeper and deeper to come out of this hole right that is the reason why i will strongly recommend you to avoid trading in the first 15 minutes now the next very important time slot which i will recommend you not to trade is from 3 o&#39;clock till 3 30 and there is a very good technical reason for that so what happens is that with most of the brokers they will not allow you to carry your intraday orders beyond 3 10 or 3 15 right so if you take a trade at let&#39;s say three o&#39;clock you barely have 10 minutes or 15 minutes for your trade to work out and if it doesn&#39;t then you will be forced to cut that position and you will be forced to come out of that so because of the time limitation i will recommend you to not take a trade in this last half an hour now the next time slot which i will not recommend all of you guys to trade is half an hour before the european markets open right now european markets they usually open at either 12 30 or 1 30 depending on the daylight saving right and the reason why we should not be taking a trade just before the european markets open is because let&#39;s say for example you have a long side buy a set you want to buy something in the anticipation that the market will go up or the stock will go up but what can happen is that if there is some negative sentiment across the globe and the european markets they open lower and they start falling as soon as they open then your long position can get into trouble right so only after you have seen how the european markets are doing it is a good idea for you to take a directional trade after that time right so now we have talked about a lot of time slots that we should be avoiding right but does it mean that the rest of the time sort that we did not talk about they are ideal for doing interacting well that depends on the strategy that you want to use right so let me go one by one if you are looking for trading momentum based strategy side where you are looking for breakout to happen or break down to happen you are basically expecting a big movement in the stock of the index then the ideal time slots based on my experience are either 9 30 to 10 30 or from 1 30 to 3 o&#39;clock because ah the first morning hours is a time when a lot of retail traders are active so there is a momentum because of them and in the last hour there is a lot of institutional activity because of which there can be some serious momentum so both of them are good time slots for momentum based strategies the next kind of strategy is the mean reversion strategy right now what exactly is mean reversible mean reversion basically means that if something has gone up a lot it is quite normal for it to come back to its mean right in a similar way let&#39;s say the market has fallen down let&#39;s say the first one or two hours it&#39;s very much possible for you to give you a pullback so if you want to deploy a mean reversion strategy then in my experience the time slots between 10 30 to 130 they work very well for mean reversion kind of strategies now the third kind of strategies are gap based strategies right so let&#39;s say there is a big gap up or a big gap down and you want to either buy or you want to sell at that time now by the very nature of gaps if you want to trade a gap either go along with it or go against it you basically have the first 15 minutes right so 9 15 and to 9 30 that is basically the time that you have to trade a gap-based strategy which as i have already discussed is not really a good time for us to trade given the enhanced volatility right but then there are traders out there who are experienced who know how to handle volatility so for you guys who know what you&#39;re doing you know this time slot is fine just keep your position sizes small so that in case you are wrong you are not going to incur a big loss now the next kind of strategy which is one of my favorite strategies is expiry day strategy right so expiry strategy for those of you guys don&#39;t know uh this is when basically option sellers they sell options we actually have made a video on this topic of several bunch of videos you might want to check them out so expiry day strategies they normally work on wednesdays and thursdays for nifty and bank nifty for fin nifty it would work on tuesdays but as of now there is not enough liquidity there so for expiratory strategies the ideal time slot is pretty wide actually right so what i do normally is that when i am trading expiry days i start selling from 9 30 of the options and i tried to wrap up my trade by around 130 and in the worst case scenario about 230 right but beyond 230 i am extremely careful because there can be some very high volatility on expiry days and whatever profits that we have made in the first half can easily vanish right in front of our eyesight so that is something to keep in mind if you want to do expiry day strategies now the next kind of strategy which is again very common is event based strategies right so whenever let&#39;s say there is a big event let&#39;s say you know budget or rbi or election or anything that we know which is coming and which can potentially move the market so if you have a strategy that you want to use on this event kind of days then first of all you need to know exactly when that event is happening right otherwise it&#39;s very very hard for you to time it and then even for an event you have to break down the day into two parts pre-event and post event so my strategies for example i i do not trade before any event because i know that before the event there can be some speculation sometimes the market can make erratic moves they are not very reliable so what i like to do is that if i have event-based strategies which i do for taking advantage of volatility i wait for the event to be out and after the event is out i give let&#39;s say another you know 10 15 minutes and then i take a trade based on uh based on the situation at that point of time so if you want to do any event based strategy then you need to know the exact time and you need to have a clarity of exactly what do you want to do before the event or after the event but in any case you should never be taking a trade through the event means don&#39;t carry a position when that event is actually happening right so that&#39;s how you should plan for your event-based strategies now there are a couple of other strategies that we really do not have a lot of time to talk about number one is scalping strategies and the other is arbitrage strategies right now scalping is a very broad term it&#39;s not just one strategy scalping has several different strategies because depending on what exactly you you are trying to scale right so if you are let&#39;s say scalping momentum then you have to go with the time slots that we talked about 9 30 to 10 30 and then 1 30 to 3 o&#39;clock that&#39;s when the momentum is the highest or if you are trading uh based on some key levels then scalping can work very best if you are doing mean reversion based states right so for that 10 30 to 130 happens to be a good time slot and then there are other ways in which scalping can be done which are not very much dependent on the timing because scalping is a very short duration right so you don&#39;t need to stay in the trade for very long time so it doesn&#39;t really get impacted a lot but then again you need to know what you are doing otherwise you can make some expensive mistakes arbitrage type of strategies they are also independent of the market hours because when you are trading in arbitrage strategy you have to take the trade when there is an arbitrage opportunity right so you don&#39;t know exactly when it might appear it might appear in the morning it might appear in the midday or it might appear in the second half so whenever it happens you need to be ready for taking advantage of that you know that opportunity but in my experience uh for arbitrage kind of a strategy it&#39;s becoming hard for retail traders to find those kind of opportunities and especially given that you know there are so many algos that are in the play you know you you really want to take advantage of that you basically have to carry the position for several days right and that of course is not part of the intraday um trading so that is the reason why i will not encourage you to do a lot of in arbitrage kind of intraday trading so guys that is basically what i wanted to share in this video i mean there are so many other things to talk about in this topic there are so many different strategies out there that i can talk about but again we have to limit the video to a certain time period but i hope that this video would have given you a perspective of how to approach intraday trading as far as the timing is concerned

Transcript for:Best Time Slots for Intraday Trading

Transcript for:
Best Time Slots for Intraday Trading