The BEST SCHEDULES to TRADE | TRADING TIPS
Find out about the best trading hours and time frames. The Head of Studies at La Factoría, Jordi Martí, explains the the best hours to trade.
Today I am going to talk to you about the best hours to trade. It is not the same to operate during the day, than to operate at night, than to operate in the morning. Let's see the best hours to trade.
In this example that I give you, I have taken a trading chart that begins at 12 at night and ends...
Read moreToday I am going to talk to you about the best hours to trade. It is not the same to operate during the day, than to operate at night, than to operate in the morning. Let's see the best hours to trade.
In this example that I give you, I have taken a trading chart that begins at 12 at night and ends at 12 at night, I have divided it into real colors and stripes based on a main characteristic, which is the volume contracted during that time zone. The first zone that I have marked in blue, which runs from 12 at night until 3:30 a.m. Spanish time, is the zone that we will call overnight. It is the area where the US has not opened the exchanges, but in futures we can trade. It is an area that is characterized by having very little volume because during part of that time only the one in Asia is open and then during the last part the one in Europe enters, but until they open in the US the volume does not increase.
From three thirty to ten o'clock is American time, it is when the Americans are operating; therefore, it is when there is more volume and it is when, as scalpers, it is where I will have more volatility and more volume to be able to trade. Later, from ten at night to twelve, we are back in the overnight zone; therefore much less volume. The characteristics of each zone is mainly the volume change. Here there is little volume, here there is little volume and here there is a lot of volume.
There is a small time slot in which you have to be very careful: the one that goes from approximately three thirty to four, four to ten or four thirty, because that is when the American market opens. At this time, when we open an American market, the indices still have to position themselves and take direction. It is a time slot, which lasts about half an hour, which is characterized by extreme volatility. Trade there is very difficult. It is much better to let them fight and once they have decided the market direction or that they are going to stay on the side, we can operate with much more peace of mind.
Finally, when we talk about the best hours to trade, we must bear in mind that there are two time changes per year. We change before them; so during one time of the year in the US they will open at two thirty, an hour before us. The hours we trade is important. If we work overnight and we will have little volume that means there will be less volatility and for some traders that is good. As a scalper what I need is volatility; Therefore, if you want to scalp you must trade in the Regular Trading Hours, which is from three thirty to ten at night. Remember if most traders had their hands down 50 percent of the time they would win a lot of money.
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