May 2020 - A1 Intraday Tips

Features of NSE Stock Open price

The opening price of the stock is price at which a first trade take place when NSE opens for the day.

An opening price of the stock is not equal to its previous day’s closing price.

Buy Orders by Buyers and Sell order by sellers determine the NSE Stock Opening price.

Demand and supply for a stock is the major factor on which the stock opening price is determined in NSE market before we tell you how the NSE / BSE stock open price are determined, we should know the NSE market timings and what happens during the same.

NSE Market Timings

The Market timings can be divided in to four parts

1) Pre-open Session: (9:00 AM to 9:15 AM)
2) Regular Trading Session : (9:15 AM to 3:30 PM)
3) Closing Price Calculation Session : (3:30 P.M. to 3:40 PM)
4) Post Closing Session : (3:40 P.M. to 4:00 PM)

1) Pre-open Session & Stock Price Discovery:
NSE/BSE Stock open Price determined in the pre-open session, so we should study the pre-open session in detail. We at A1 Intraday tips have given in-depth information about Pre-Open session that is easy to understand for beginners in the stock market too.

2) Regular Trading Session: (9:15 AM to 3:30 PM) : Normal trading take place during this session. Trade take place depending on the order places by buyer and sellers.

3) Closing Price Calculation Session: (3:30 P.M. to 3:40 PM) Closing price is calculated based on 30 minutes weighted average price from 3:00 pm – 3:30 pm. during this session.

4) Post Closing Session: (3:40 P.M. to 4:00 PM) : Similar to pre-market orders, post-market orders are allowed only for equity trading. The post-market session or closing session is open from 3:40 PM to 4:00 PM.

Pre–open market Session

Pre–open market session is divided in to three sessions.

Order Entry Session: The First session takes place between 09:00 AM Till 09:08 A.M. both Market and limit orders can be placed, modified or cancelled during this Pre-open-session.

Price Discovery Session: This session happens between 09:08 till 09:12 am, Price discovery happens during this session as both buy order and sell orders are matched during this session.

Transition Session : This session is the final session of just 3 minutes that start at 09:12 and ends at 09:15, when the normal market opens for trading. This is the transition period from pre-open session to normal market.

How the opening Price of the Stock is determined?

Pre-open session is a 15-minute session in NSE market (9:00 AM to 9:15 AM), which helps to get the opening prices of stocks traded in NSE. It is basically the period of trading activity that takes place just before the regular stock market session. During the pre-open market session, system takes all orders that are executed and then arrives at an equilibrium price.

The calculation of prices is completely automated, software driven and anonymous at both BSE and NSE, and the price is calculated by electronically matching bids and offers for a particular share recorded an electronic limit order book (ELOB). The equilibrium price is the price of the stock that is derived based on the demand and supply of the stock during that time.

NIFTY 50 and SENSEX 30 stocks at NSE and BSE respectively, have been enabled for trading in the Pre–open market session by the exchanges.

We have provided in depth information about how the opening price of the stock is discovered during the pre-market session. This is very important for traders as they are clear of the happenings in the NSE market.

If you are looking for the top intraday trading tips A1 Intraday Tips will help you to gain maximum profit with minimum risk by providing the free intraday tips. For Free Trial you can register here to avail our Free Intraday Tips for 2 days. You can also download A1 Intraday Tips mobile app here. For more information call us at 07506090788 / 07600797534.

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In this blog investment advisory team at A1 Intraday Tips has tried to explain that the meaning of Target & Stop loss in NSE Share Market.

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What is the Target & Stop Loss?

We advise to all traders, that whenever a trader or an Investor buys or sells the share/stock he should also decide the target and stop loss for that particular stock to avoid loss of his capital. Generally when share market is going up, Investor /trader should buy the share /stock, set a target and stop loss. We would like to explain this by giving a live trade example

Buy Reliance @ 1000 target 1025 and stop loss 980. This means after buying the Reliance stock @ 1000, if stock goes up and makes high of 1025, its could be called as target achieved, the trader should sell the shares and book his profit. Same way if stock price goes down and makes low of 980, which is the stop loss fixed by the trader, a trader should book loss by selling the shares @ 980. This is called as stop loss trigger in trading at NSE Market.
If Market is in bearish trend and market is going down Investor/trader can short sell to make profit. First short sell the stock and then buy the share, also is a very good idea to make money in bearish market. Again we would like to give a live trade example of short selling, so that a novice / beginner in trading can understand the concept better, and can do winning trades in stock market.

Suppose a Trader Ajay plans to Sell Maruti @ 5000 for target’s 4700 and stop loss 5150. This means after Selling Maruti stock @ 5000, if stock goes down and touches low 4700, the target gets achieved. Same way suppose if stock goes up and makes high of 5150, stop loss will get trigger. Ajay will have to Buy the Maruti and book loss of 150 on every share.

How many types of Investor?

Commonly there are three types of Investors.
Intraday Traders (On daily Basis)
Short Term Investor (Invest For two to three Months)
Long Term Investor (Invest For minimum 1 Year)

How do you calculate a target & stop loss price for a stock?

Target & Stop Loss for Positional Trades

If you are taking a Short term / long term Positional trade, calculating Share/ stock target & stop loss prices relies on a lot of data, Fundamental analysis of the company, News on New orders, Mergers, etc. There are lot of broking house who also give recommendations or Individual Investment Advisories who can help you with this research. A Well Research stock using fundamental analysis can help you determine whether a stock is undervalued or overvalued as per its peers in the industry. This will help you to set target and stop loss for the stock. Although stock targets can be frequently adjusted as per the behaviour of the market from time to time. Target and stop loss, can use as figures so as to avoid big losses and to book good profits too.

We recommend a Target of 10-15% for Short term trades and 25-30% for long term trades. Similarly a Stop loss should be set at 8-10% for short term and 12-15% for long term trades

Target & Stop Loss for Day / Intraday Trades

Intraday trading is done by studying charts, Study of Technical indicators, so as to make winning trades. A Day trader should Buy at low price and sell at high rates during the day to make profits. If market is bearish or it’s falling a trader can short sell first and square off by buying later to make profits. A Well Research stock using technical analysis should be place for at 1.25% to 1.5% for intraday trades in NSE Market. A stop loss should be set at 1.5% to 1.75% for intraday trades to avoid loss of capital.

A Trader should be adjustable in fixing the target and stop loss in volatile markets. This should be done some times only if market is very volatile only.

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Also Read:

How can I Buy Shares in NSE India?