Top 5 Intraday Trading Indicators & Setup


Traders use intraday trading indicators for Intraday Trading Setup. Whether a trader is a beginner or an experienced, indicators are important. It helps you plan your trading for the maximum returns. Referring the intraday trading tips, charts, and indicators is a common way.

Day trading indicators minimize the risk level. The indicators provide useful information on the market trends. This post guides you to understand the indicators. As a thoughtful investor, you also need to decide how much you want to rely on the indicators.

# Why you Should Use Intraday Trading Indicators

Intraday trading indicators provide good guidance. The most useful information from indicators is here. Traders use it for assessment of the market scenario before trading.

  • Direction of the current market trend
  • Momentum in the investment market
  • Chances of profit
  • Volume assessment to know the popularity of the market
  • Demand and supply trading theory

The crux lies in finding a right mix of the indicators for profitable decision. Too much of information might spoil the strategy.

# Top Trading Indicators for Intraday Trading Setup

Not all traders prefer to use the Intraday trading indicators. If you use, pick the most suitable and useful. The below list contains some common ones.

  • Oscillators – Oscillators type of indicators reflects up and down flow. Popular oscillators are Stochastics, CCI or Commodity Channel Index. Others are MACD and RSI.
  • Volume – Volume indicators are a mix of price data with volume. They determine how strong the trends in the terms of prices.
  • Overlays – Overlays indicators are Moving Averages and Bollinger Bands. Parabolic SAR and Fibonacci Extensions are other Overlays. Moving average determines trends. Fibonacci isto plan profit targets. CCI have a good number of uses like trends and trade triggers.
  • Breath Indicators – The Breath Indicators are stock market related. The major ones are Ticks, Tiki, Trin and also the Advance-Decline line. They relate to the sentiment of the traders. They reflect what the large part of the market is doing.
  • Bollinger Bands – This comprises three lines. The lines show moving average, lower limit, and the upper limit.

[ Also Read : Intraday Trading Techniques ]

# How to Read Intraday Trading Indicators

Using many indicators is not a good idea. Pick the one among the most useful ones. Also, use the one that you can read well. Find here an easy way to understand the most popular tools available.

1. Moving Averages (M.A.) :

The market trend is bullish when the long-term averages are less. It is bearish when short-term averages are less. This helps traders to earn indecent profit in intraday. Its very Simple Intraday Trading System.

Uses of Moving Average

  • To find the trend, either up or down
  • To know the reversal of trend
  • To find out the stop loss and trailing stop loss
  • To find out the price over extended

             Basic Buy signals for MA

  • Moving average should almost be parallel and at equal distance
  • They should be in ascending order
  • Lowest Ma is at the bottom while highest Ma is at the top
  • The first signal get generated when the price cuts the short ma from the bottom

             Basic Sell signals for MA

  • Moving average should almost be parallel and at equal distance
  • The moving average should be in the descending order
  • The first signal get generated when price cuts the higher Ma from the top

Intraday Trading Indicators - Moving Average

2. Moving Average Convergence Divergence(MACD) :

MACD is used to identify the different aspects of overall trend. These aspects are momentum, trend direction and duration. MACD takes the difference between two lines as histogram and oscillates above and below center zero line.

MACD Moving Average Convergence Divergence 1 MACD Moving Average Convergence Divergence

[ Also Like : Intraday Trading Time-frame ]

3. Bollinger Bands (B.Bands) :

The price may go up in some time if the stock trading price is below the lower line. Traders decide to take a buy share strategy.

  • The band may be at high or Low.
  • It uses Band Bollinger Demand and supply Zones.
  • Always Buy in demand zone with lower band touching the price at Support.
  • Sell In supply zone with higher band touching the price at Resistance.


4. Relative Strength Index (RSI) :

when RSI touches 70, selling the stock is good. Vice versa, buying is good when it RSI goes down to 30. Yet, a stock-specific study is important.

  • This indicator is known as Momentum Indicator.
  • RSI indicates that the price is Oversold or Overbought.
  • RSI compares the price Between Advancing period and Decline period.
  • The Common parameter is 14 period.

RSI - Intraday Trading Indicators


[ Must Read : Intraday Trading Rules ]

5. Average Directional Index (ADX) :

ADX is used to quantify the strength of the trend. ADX calculations are based on a moving average of price range expansion over a given period of time. The default setting is 14 bars, although other time periods can be used.

  • This Indicator is Momentum Indicator.
  • Reading between 0 to 100
  • Below 10 to 15 indicates the consolidation.
  • > 25 reading indicates the strength
  • Calculated from +di and –di

ADX - Intraday Trading Indicators

Intraday indicators are not a proven way to earn profits. They are good to read the market moods for the best investment decisions.