How To Pick Stocks For Intraday Trading Like You’re Making Instant Noodles

Among different trading types in the stock market, intraday trading offers many trading opportunities to make quick money. However, picking the right intraday stocks on any trading day decides the success of a trader.

Day trading can also give a fatal blow to your account if done casually. Hence, picking the right stocks on any trading day is vital in trading.

Most of us can prepare instant noodles, right? Using similar simple methods, we can also shortlist the stocks for intraday trading.

Below three points give clarity about picking the right stocks for intraday trading with ease:

1. Intraday Trading System

2. 2 Steps to Shortlist the Stocks

3. Market Confirmation to Trade

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Intraday Trading System

“All you need is one pattern to make a living” – Linda Raschke

“The man who chases two rabbits, catches neither” – Confucius

“I am not afraid of a person who knows 10000 kicks. But I am afraid of a person who knows one kick but practices it for 10000 times.” – Bruce Lee

Can you think of the similarity among the above statements given by three achievers from different areas?

It is all about getting mastery in concept. Intraday trading is no different, and every trader should ask a question to himself - "What is important to me in trading - making money in the long run or trading every pattern?"

If you choose ‘making money’ over ‘trading every pattern,’ you have to finalize a trading strategy/system among many intraday trading strategies.

Then how to do intraday trading?

Do you agree you want to trade only the stocks which have a higher probability of giving big moves on any particular trading day?

There are varieties of intraday trading systems. But ask any experienced trader, they agree ‘Breakout Trading’ is an excellent intraday technique to catch good moves in day trading.

Image 1 – Intraday Breakout Trade Example in Bajaj Finance

The above image shows an example of a breakout trade at the intraday level. The price opened above the previous day high, rallied throughout the day, and closed at the day’s high.

Many intraday tips providers use the same strategies to pick the best shares for intraday.

2 Steps to Shortlist the Stocks

We have narrowed down the trading system for intraday trading from a vast intraday technical analysis area. But we have 1000s of stocks in NSE, and how to shortlist the stocks for subsequent day trading?

Definitely, we should have intraday stock selection criteria.

This is where screeners help us! First, they shortlist the stocks based on certain conditions (like today’s move, volume, etc.).

Below are the two screeners:

1. Excel Screener

2. Chartink Screener

Excel Screener

This scanner picks the data from the NSE India website for Nifty-50 stocks, Nifty F&O stocks, large caps, mid-caps, and small caps stocks.

Then it compares today’s range concerning the past few days range.

If it is bullish and the volume is high compared to the past few days, it will list the stock as a breakout stock.

The advantage of this screener is that it also lists whether the breakout candle has selling wick or not and information about the volume.

Please watch the below video to know how it works.

Download Breakout Screener

Please note:

1. You will be able to run this screener only after 6 PM IST.

2. It doesn’t support the Mac system and older versions of MS Excel (older than 2010).

Image 2 – Intraday Breakout Stocks list from Screener

Once you run the screener on any trading day, it shortlists the breakout stocks from the extensive list of stocks from NSE.

Not all the stocks listed here are ready as a breakout trade for intraday stocks for tomorrow. Besides, it is impossible to track these many stocks in the live market.

Hence a trader can click on the link (last column) to view the charts. Then one can apply the primary price action or support & resistance concepts to shortlist the stocks.

Image 3 – A Good Breakout Example from the Screener

For example, on 26th May 2021, this screener shortlisted Bajaj Finance as a breakout stock.

There is a clear resistance trend line, and the price closed a little above the trend line.

The stock has displayed more buying volumes in recent days, and also it consolidated over 7-8 days (short buildup) before the breakout.

Hence, it is a good breakout candidate for the next day.