Time And Timing In Day Trades - Comprehending The Stage And The Best Times To Trade Forex And Futures
It is of great importance to grasp the time that you choose to trade in and know what you can potentially expect at that time of day.
This differs for each instrument so it is crucial to study market behavior for your particular instruments. I generally trade only 3 instruments the DAX, Euro/USD and the GBP/USD and am familiar with their behavior during the trading day. Other instruments act differently so I will only trade them (and I do sometimes trade S&P, WTI, , and other currencies) after I've studied their time related patterns.
Timing issues are not easy to figure out and sometimes it's easier to purchase a trading system, not so that you can follow it stupidly but instead use it to complete your own reading of the market. Always best to read forex trading system reviews. A systems I use regularly to supplement my decisions is forex rebellion. It fits in nicely with my MT4 setup and adds confirmation to the timed entry.
The most suitable time to trade the DAX is close to the London open at 03:00 EST, as the open commonly brings a large surge in volume and it's easy time to scalp.
It is often possible to achieve a gain of 20 - 40 points in the first 30 minutes of trading. As my daily target is 30 points and it is often hit within half an hour, I can then take it easy and look for ideal set ups that will not risk the gain.
Another good time to trade the DAX is around 13:30 UK time (08:30), but need to watch out for any news announcements as this is the time most US releases come out (CPI, GDP, NFP etc). It it a pretty volatile period and once again it's easy to capture good moves then.
About 60 minutes after the markets open (London and NYC) we commonly see consolidation and I tend not to trade these times, it can be quite frustrating.
Surely you've noticed how fast the time goes by when you are in a trade that is going against you and how slow it is when a trade you've entered just hovers around break even.
Chances are that it's the same length of time, it's just our mind playing tricks on us. In my view, I expect a trade to move my way within 2 bars (1 min, 5 min or any other time frame you trade). If it just hovers around I get out and wait. My experience is that if a trade doesn't move your way quickly, it is a less probable trade. Practice patience before entering a trade and not after you've entered it.
Timing is a separate issue and depends on your trading method, one of the methods I use, is reversals at known pivot points. This is a rubber band type of trade and routinely a person can catch a turnabout and a new short term trend.
In these cases, with scalping, if you have a particular price area you have designated, timing makes a big difference, enter too early you may get stopped out, and if you enter too late you will miss out.
Bottom line, remember that trading is 90% is in the mind, and if your mind is not focused or you're not in a good state it's best to not trade, better to recover, and then resume.
I use meditation, and always make sure I am completely calm and confident before I trade. Lately I've been using a subliminal video and I find it's beneficial, 10 minutes of watching and I am ready to make money easily.
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