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Why to Avoid Intraday Trading on event day

Here A1 Intraday Tips advises all Nse Intraday Traders and small traders to avoid Intraday trading and stay away from market as market become very volatile during this major events days in nse share market. A Trader can lose his hard earned capital as he could end of losing lot of money.

What is event day in NSE share market ?

There are so many events days in NSE share market like RBI policy, Budget Day, any specific quarterly company result, events in global market, Fed Policy. This event could also include any Emergencies like a meeting addressing by Finance Minister or a Prime Minister of India. A event day could be a Terrorist activity in Indian Soil as well in any foreign country. Any Election held for Parliament or Assembly held in India or its results can be called as a event in nse stock market. Recently A Global crisis Corona Virus / Covid 19 had a very adverse impact on stock market. It went in to bearish trend as adverse news of medical emergency was seen by the whole world.

Avoid Trading on Events Days

What is the Impact of events day on Nse share market ?

We have given some important information about some events in the market and its affect on the nse market so that new trader/ investors can get the important knowledge of those events.

  • RBI Policy

  • Budget Day

  • Company Results

  • Global Market

  • FED policy

  • Election Result

RBI Policy

When the RBI governor release RBI policy, it if any changes are announce in SLR, CRR, Repo rate, Reverse Repo rate, Bank Nifty, PSU Banks and Private Banks becomes very volatile and choppy. Because if the people are expecting a rate cut and if that rate cut is not announced by RBI in its policy as per market expectations market tumbles down.

Budget Day

Market is extremely volatile on budget day because Common man, Brokers, Industrialist, Investors expect lots of thing from finance minister during budget in February month. On budget day Finance Minister is expected to give relief to some sectors like on reducing excise duty, reducing import duties for export oriented companies. Government is also likely to increase the excise duty on sophisticated items like Washing machines, Air conditioners, Car makers, Tyre makers, gold, LED TV, Heavy electronic components etc. In some cases Govt can also lower excise duty on some products like ventilators, medicine (made by indian pharma companies), pipe makers, solar equipment makers. This may impact the companies in the manufacturing of those products and sector as a whole in some days but this news will impact stock market on the same day.

Company Results

No body can predict or analyze about quarterly result of any Company. Some time Market, technical analyst and investor predict the result and if the result are poor and are not as the predicted by those experts, the share market tends to go down. Also if company result are good as per the expectation's of the people the stock is likely to go up. A Good results by a Big IT sector company like TCS, Infosys can impact the IT sector as a whole. Any good results by them could bring a big rally and any bad results could bring a bearish trend in the market.

Global Market

The Indian market both Nse and BSE indices are depends upon global market indice's like SGX nifty trade in Singapore Market, U.S.A market ( Nasdaq & Dow Jones) European market (FTSE 100, CAC 40, DAX 30), Hang Sang, Shanghai, Nikke, Kospi. If the Global market have gone up overnight then on very next nse working day in the morning Indian market is also likely to to open gap up and can trend higher. In the same way if global market are down, Indian market are likely to open down Indian market specially depends upon the SGX nifty and its should be track every morning when it opens for trade in singapore market. Our NSE Nifty always opens as per the trend of the Sgx Nifty.

FED policy

Federal Reserve System also called as FED refers to Central banking system of USA. The Federal Reserve conducts the nation's monetary policy by managing the level of short-term interest rates and influencing the overall availability and cost of credit in the economy. Monetary policy directly affects short-term interest rates; it indirectly affects longer-term interest rates, currency exchange rates, and prices of equities and other assets and thus wealth. Through these channels, monetary policy influences household spending, business investment, production, employment, and inflation in the United States.

By increasing the federal funds rate, the Fed basically attempts to shrink the supply of money available for purchasing or doing things, thus making money more expensive to obtain. Conversely, when it decreases the federal funds rate, it increases the money supply and encourages spending by making it cheaper to borrow. Any Rate cut by FED is big boost to our stock market in India as they move up.

Election Result

The Election result of Parliament and Assembly directly affects Nse & Bse Market. Any Good showing in results in Assembly Elections by BJP party will boost share market and vice versa. It has been observed that many more times markets behaves unpredictable on Election Results Day, Nse can become very volatile could go up or down by 500 to 700 points beyond any predicted range. So the chance of losing the hard earned money is very high on that day.

We A1 intraday tips advice to all trader and investors to stay away from market on the above events days in Nse market to preserve your capital.

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