Intraday trading involves opening and closing positions within the same trading day, with no overnight exposure to market movements. This trading style focuses on capturing short-term price movements using technical analysis, news events, and market momentum. Intraday traders must be highly active, monitoring markets continuously and making rapid decisions to capitalize on brief opportunities.

Intraday trading requires sophisticated technology, real-time data, and efficient execution capabilities to compete effectively. Transaction costs, including commissions and spreads, significantly impact profitability due to frequent trading activity. Successful intraday trading demands strict discipline, risk management, and the ability to quickly cut losses while maximizing profitable opportunities.

Real-world example: An intraday trader buys 1,000 shares of Tesla at $250 following positive earnings news at 10 AM, then sells at $255 by 2 PM, capturing a $5,000 profit without overnight risk exposure to potential market gaps.