What is Open High Open Low Strategy in Intraday Trading in India?

In today's post, we will explain Intraday Trading and the Open High Open Low strategy.

Intraday Trading is a popular trade in India because of the daily Return on Investment (ROI). Many traders prefer Intraday Trading strategy due to the daily profit without considering the difficulty in the market depending on the various tools and strategies.

Intraday Trading is trading that takes place "within the day," it often refers to the high and the low price of a stock with the orientation of daily profit making.

Intraday trading also means buying and selling underlying assets, which could be a commodity, a share, a future contract, or an options contract within the same day. The main point is that the buying and selling must be completed within the same day. Once the profit is achieved, then you exit the trade, or you exit as soon as your daily target is achieved.

An intraday buy signal is generated using the Open High Open Low strategy, particularly when an index or stock has the same value for both the open and the low price.

However, when the index or stock has the same value frequency for both the open and high, a sell signal is created.

When a high amount is started proportionately for tiny aims, intraday trading strategy performs better. Because of the high-risk ratio associated with intraday trading, it is crucial for successful traders to choose a wise, rapid entrance and also be skilled enough to execute a swift exit for their earnings.

The strategy may be common but not as simple as we hear it.

1.   Stock Chart Analysis (Long-Term)

Trading is not just what to dabble in to make a profit; it requires deliberate actions. The Open High Open Low strategy helps traders to analyze and forecast the direction of prices by studying past market data, primarily price and volume, so that you won't trade against the trend of the market structure. This is the major problem associated with new traders. Open Low Open High strategy gives you a comprehensive view of the market even in a larger time frame.

2.   High-Risk Reward Ratio

Traders use this Intraday Trading strategy because of the high risk and the compensatory high reward. Intraday helps the traders to set appropriate Stop-Loss. The difference between a sell or take-profit order and a trade entry point to stop-loss is measure

Stop Loss (SL) is a clause that stops traders' losses at a particular point. Stop Loss order indicates when you are willing to close a trade position even if you are not near your device, while Take Profit (TP) is a pending order to close the winning position of a trade when it reaches a particular price.

3.   Evaluating Equity Trends Using the Scanner

Open High Open Low strategy afford traders to make a wise decision as equity shows the secured part of the trading, which includes the open position that is bound to the balance and floating rates. Traders might need to wait till the market reaches a secured position before taking a trade.

It's general knowledge that Intraday Trading opens around 9:30 a.m. As such, you should prepare to enter your trades at least 15 minutes before the market opens. Before considering trading, you would definitely open a trading account.

You will need to log in to a trading platform or broker such as Mitrade.

They provide technological infrastructure and software that enable real-time transmission of financial trading information. As a result, you should start the execution of the open high low trading strategy before 9:15 a.m. by following the steps below:

●   Log into your trading account to check that you have enough funds to place the trade.

●   The next step is to use the app's or desktop UI to navigate and establish a watchlist of scripts. By 9:15 a.m., or 15 minutes before the market starts, your script watchlist should be prepared.

●   The previous day's highs, lows, and pivot levels must be noted while creating the watchlist and are accessible on the brokerage platform.

●   At least until 9:45 a.m., keep an eye on how the values of your scripts are changing depending on changes in open interest for derivatives securities or news about the equities. To see the changes, you may also check the analytical charts.

●   You may enter the long at 9:45 in the morning. Wait until the price moves past the high of the previous day when the market starts. Once it is broken, you should determine whether the starting price and the low of the day are equal. If it does, you can buy and hold your stop loss at the low price of the current trading day.

●   If you want to join the market for a short position around 9:45 a.m., you can also use the intraday open high low approach. In this situation, you should once more record the lowest price from the prior day before 9:15 a.m. Wait until the price breaches the previous day's low after the market begins for the current trading day. As soon as it happens, you should see if the starting price for the current trading day is identical to the day's high at that moment. If it happens, you ought to short and set your stop loss at the high price of the most recent trading day.

●   After successfully using the open high low trading strategy, you may close the position either at the close of the trading day or when it reaches your specified Take Profit or Stop Loss.

Additionally, if you are on short and the stock of your long attain a new high or low within the trading day, then you should close the position. The specifics of the new highs and lows are available on your trading platform. In order to re-enter the trade whenever it triggers again, be sure to leave the transaction if the stock breaches a low.

1.   Strategy Trading Volume

The number of shares transacted daily, as there is a seller for every buyer; one can think of the trading volume as half of the number of shares transacted. That is, Mr. John sells 500 shares to Mr. James, so the volume is 500 shares. In Intraday Trading, traders are advised to make decisions on shares with high volume; this will secure the assurance of the trader.

2.   First Candle Closing Picture

It is good and easy for traders to use the Open High Open Low strategy to initiate their trade if the first candle's closing price is less than the second candle's closing price. That is, before the first out of the three big Candles of the first 15 minutes time frame of the day.

3.   Risk: Reward Ratio

In Intraday Trading, The use of qualitative and quantitative methodologies to lessen the uncertainty of the results and the costs, liabilities, or losses should be taken into consideration. Ratio 1:2 has been a favorable ratio used by many professional traders.

4.   Range Breakout

In using the Open High Open Low strategy, traders can make use of the opportunity when the current price break above or below the previous day's high or low price. Breakouts range is used when the market is already near the extreme high or low of the most recent day. Once you notice it goes a little below or higher, then pick a trade.

Open High Open Low Intraday Trading strategy is a good strategy for traders that wish to make daily profits from their investment by putting all caution into consideration. Moreover, beginners seeking to trade Intraday using the Open Low Open High strategy should choose a broker with a successful record. Mitrade is one of the successful stock brokers that can be trusted and that gives a guide for every step.