Can I buy stock when upper circuit?

If your purpose is to buy shares in the stock exchange specifically when the stocks hit the upper circuit then you must follow the stated tips.

But, are you aware, what is the circuit limit? It is the crucial element in managing the trading activity when stock prices go up and down indefinitely.

Such a sharp rise and fall in stock prices happens only when traders perform excessive trading to make profits exceptionally.

SEBI and the stock exchange have devised checks and counter checks to keep a track on the stock price movements by setting upper and lower circuit limits.

Extreme stock price fluctuations occur due to several reasons such as: Sometimes positive news announcements can make specific stocks prices rapidly rise or bad news can make the stocks prices go downward.

When there is high volatility of stock price, the SEBI uses the upper circuit to regulate such price fluctuations.

If the index hits the upper circuit then the trading shall come to a halt for a while. The circuit limits for stock indices like Nifty & Sensex will be in order of 10%, 15%, and 20%.

Note: A similar situation prevails when volatility goes low and the index hits the lower circuit.

Trading in the Upper Circuit Stocks:

The answer to your question, yes you can do trading in the Upper Circuit Stocks provided as and when the stock exchange releases the circuit to conduct trading.

The trading in this region can be proven as profitable and it keeps you in a risk zone.

You must be keen in market dynamics, conduct technical analysis, and risk management.

Once the circuit is released you must practice daily monitoring, and analyse the hourly charts. By doing so, you can obtain maximum gains and avoid trappage in the lower circuits.

You can encounter the buying sessions easily as the circuit levels begin to fall.

Circuits Keep Regulates the stock market price manipulations:

More specifically, these circuit limits are set up to regulate price fluctuations in a day such as intraday trading.

Certain days, traders get euphoric in buying shares then these circuits limit the market fluctuations. It also controls the stock price manipulations caused by the stock traders.

Stock Exchanges Declare Circuit Limits Daily:

SEBI keeps a check on the circuit limits day in and day out while the stock exchanges announce the stock filters in their websites daily.

The moment the stock hits the upper limit, the exchange does apply a circuit limit of 20 percent upon the closing stock price of the previous day.

Despite the setting of stock filters if the stock continues to maintain volatility then the exchange shall transfer the stock to the T2T segment.

Then, the deliverables are made compulsory and this info can be obtained on the stock exchange website.