Intraday Trading

Intraday trading, or day trading, flattens by the close. The edge being sought is inside the session: the open drive, a break of the prior day's high, a reversion to VWAP, a range formed in the first hour. You do not get paid for the overnight move, and you do not take the overnight gap. The cost is intensity and turnover. Spreads and slippage are paid every trade, and the sample of decisions per day is large enough to include several bad ones. Intraday trading is a profession's schedule, not a style you add on top of another job without changing the rules. If you cannot watch the exit, you cannot trade a system whose exit is a five-minute level.

Know the session you trade. The open is not the midday, and the close is not either. Many intraday systems only trade one of those windows and are flat the rest of the day. Define the flat time and obey it. A day trade that you convert into a swing at 3:25 is an unplanned overnight position, sized for a day stop, held through a gap. Use the prior day's high and low, the session VWAP, and the opening range as the default map. Add a setup only after those reference points are boringly familiar.

Risk a fraction that survives a string of stops, because several trades per day make a cold streak ordinary. Cap the number of trades. Three well-specified attempts will teach you more than thirty reactions. Flatten into the close even if the last trade "needs five more minutes." The close is a liquidity event and a discipline event. End-of-day marks, margin, and your own fatigue are all worse if you extend the session by hope.

Trading the open with a size meant for the quiet midday. Also using a daily chart pattern as if it were an intraday trigger, then being stopped by ordinary intraday noise. And adding strategies mid-session because the first one was idle. Idleness is a result. It is allowed.

Costs dominate small intraday targets. A setup that wins a few ticks and pays the spread both ways can be a losing business with a pretty win rate. Instruments with poor intraday liquidity will slip more than the plan. Intraday trading also does not diversify a bad day: the same session mood hits every attempt. The daily loss cap is the real risk tool. Without it, a method of small losses becomes one large afternoon.