Лучшее время для трейдинга

During the day, there are periods with a large number of transactions and quiet times. Even days of the week differ in activity. In this article, we analyze when the best time for trading is.

Why does time play an important role in trading?

First of all, time is one of the main factors for day traders. There are many events to monitor during the day. An experienced stock or currency trader is well aware of:

• when do the new york and london stock exchanges open,
• what time are unemployment statistics released in the US,
• when the Fed or ECB rate is announced,
• Oil reserves are announced.

This knowledge is important for successful trading.

During such hours, volatility increases, due to which sometimes in 30 minutes you can earn more than in the rest of the day. The Pareto rule is confirmed, which says: in sales, 20% of the efforts give 80% of the result. For exchanges it is even more relevant: knowing the time of events, you can earn a daily profit in 1-2 transactions.

As an example, we will give the dynamics of the Bitcoin price on the day of the Fed rate change on a minute time frame.

Trading proceeded according to the following algorithm:

• Volatility was minimal at the start of the day.
• Following the announcement of the rate hike, the price of the cryptocurrency fell sharply.
• Then came a quiet period, during which the Fed chief gave comments.
• Then there was an explosive rise in Bitcoin: the head of the regulatory body hinted that the rate would not be raised in the near future.

Thus, first a trader who knew exactly when the Fed chairman would speak could make money on the fall, and then on the rise in price.

In addition to the main events, you need to know the working hours of the main exchanges. Trading platforms are interconnected.

For example, calm trading in Europe can suddenly become more active after the opening of the Chicago or New York Stock Exchange , which have reacted emotionally to some internal event: bad statistics, good reporting by an American fund, etc.

Knowing such time features helps a trader to “be on guard” and react promptly to strong price movements.

Market Hours: Which Exchanges Are Open at Different Times

The world is divided into time zones: when in one part of the world they are just getting ready to get up, in another they are already working, and in a third they are getting ready for bed. The working hours of the stock exchanges also depend on the country of origin.

If we look at Europe, for example, all the main exchanges on the continent operate at roughly the same time, be it the French Bourse de Paris, the German Börse Frankfurt or the London LSE . But on a global scale, things are different.

There are four time periods that traders focus on:

1. Pacific.
2. Asiatic.
3. European.
4. American.

Each region is home to several major exchanges that influence global asset trading.

Pacific session

Opening time according to Moscow time or Kyiv time (we will compare with them further) is 24-00-1.00. Closing time is 9.00-10-00. The largest exchanges are located in New Zealand (Wellington) and Australia (Sydney).

News from these countries does not have a significant impact on the world market, so the time from 24-00 to 3-00 in round-the-clock trading, for example, on Forex, is considered the calmest. However, there are also surges here: the New Zealand (NZD) and Australian dollar (AUD) can significantly fall or rise when local key news and reports are released.

Asian session

The main stock exchange of the Asian region is Tokyo. Among the other largest, we will note Shanghai, Hong Kong, and Singapore stock exchanges. Opening time is 2:00, closing time is 11:00.

Asia is home to the largest financial centers, so these exchanges have a more significant impact on global stock and currency trading. Activity increases significantly at the opening of “Asia”, including due to the simultaneous operation with the Pacific session.

Trading volatility can be significant for internal reasons, for example, when local central bank rates change or when major corporations release poor reports.

But strong price changes are also often observed after the effect of European and American news from the previous day has played out.

European session

Working hours: from 8.00-9-00 to 17-00-18-00 Kyiv time and Moscow time. It is during this period that the largest number of transactions are concluded, trading in the euro, pound, and Swiss franc is activated. The main European exchange is London (LME). At this time, a lot of economic information is released:

• Central banks changing rates.
• Data on unemployment, production, consumer demand.
• Reports from companies, etc.

Trading at this time is characterized by high volatility due to the large amount of information received by the market.

American session

It opens from 15-00-16-00 and closes at 24-00-1-00. It is during this period that the greatest trading activity is observed. Transnational corporations, the largest banks and funds enter the fray.

The largest number of transactions per day are concluded between 15:00 and 17:00 (16:00–18:00), when the American and European sessions overlap, and the market receives the maximum share of economic data for the day.

You can see the session running time schematically in the figure.

The Influence of Geographical Location on the Choice of Optimal Time for Trading

You can trade currencies and stocks 5 days a week, 24 hours a day. But a person’s physical capabilities are limited, so no trader will sit day and night at the monitor and make deals around the clock. It is necessary to choose the optimal period for trading.

For a trader from our latitudes, the best time will be from 9-00-10-00 to 17-00-20-00. During this period, there is maximum activity on the exchanges, so in this sense, Europeans have some advantage over Asian and Pacific traders.

Day trading requires a clear mind, emotional stability and quick reactions, so working within your geographic area is one of the conditions for achieving good results.

Here you also need to consider the asset you are trading and adjust your time to it. For example, when making deals:

• For Australian or New Zealand dollars and Japanese yen, it is best to use the period from 3:00 to 9:00 am Moscow time.
• Japanese yen with euro, British pound and dollar – from 9-00 to 11-00.
• Euro, US dollar, British pound and Swiss franc – from 15:00 to 18:00.

Market Volatility Analysis: How It Changes at Different Times of the Day

Volatility is the change in price. Low volatility means the price hardly changes, high volatility means the asset value rises or falls significantly.

Volatility changes during the day. This is clearly visible in the chart below. As we can see, the exchange rate moved most sharply during the simultaneous operation of European and American exchanges, during this period trading is carried out with maximum volumes. Minimum volatility is observed in the evening.

Volatility and volumes of assets during the day

Let’s take a closer look at volatility at certain time intervals during the day:

• 00.00—2.00: trading activity is low, but volatility does occur, especially in the first minutes of the opening of the Pacific session, when players play out the dynamics of European and American exchanges.
• 2.00-4.00: volatility is high, Asian traders join Pacific traders, who can play off positive or negative data from American and European exchanges, and reports from their financial institutions.
• 4.00–8.00: Volatility is low, except during periods when corporate reports are released or unexpected information about the state of the economy appears (rates change, production falls/rises, etc.).
• 8.00-10.00: Volatility is high, Europe joins Asian traders. There is always a surge of activity at the beginning of the session, investors often cannot decide on the direction of movement, there are “swings”.
• 10:00–15:00: volatility is average, increases when economic data is released, but, in general, trading is neither here nor there.
• 15.00-17.00: volatility is high, the highest for the day. At this time, America joins Europe, the US releases a large package of data on unemployment, oil reserves, consumer demand, the Fed comments on its policy , etc.
• 17.00-20.00: volatility is average, but when important corporate reports are released or unexpected economic information appears, prices can change significantly.
• 20.00-24.00: volatility is low, all daily information has been played out, only American asset traders remain on the market.

In addition, the strength of the price movement depends on the type of asset. For example, the volatility of the euro-dollar pair is lower than that of the dollar-emerging market currency pair.

The day of the week also has an impact: Monday and Friday are, on average, more volatile than other days.

At the beginning of the week, traders play off the information that leaks into the information field over the weekend, and on Friday, some traders close positions, freeing themselves from possible risks, while others open them, hoping for a positive trend after the weekend.

Psychological aspects: how a trader’s mood affects the timing of trades

You can choose your own trading time – working online has expanded our opportunities. Another issue is that at night it is more difficult for many of us to make deals: the brain works worse, the reaction slows down, we react more emotionally to events.

Therefore, the main recommendation for a trader is to listen to your body and work when you are used to being awake.

Another point: if trading is not your only job, then choose a time so that it does not overlap with another type of activity. Trading on the stock exchange requires concentration and scattering on several things will only worsen the result.

In addition, when quotes change sharply, a trader may react differently at different times of the day. Often, in a critical situation at an unusual time for him, a trader is slow.

Then, seeing the problems growing like a snowball, he becomes apathetic, discipline fades into the background and the account is lost.

Therefore, do not chase profits around the clock – trade only when you are best at it. However, if you do decide to work at other times, at least do not forget about risk management methods:

• Analyze the situation in advance.
• Develop a trading plan .
• Set the loss percentage.
• Use only a portion of your funds for each trade.
• Set entry and exit points, place stop orders .
• Control your emotions.

Another issue is that it is more difficult to manage risks at night than during the day, since at this time the psyche of any person is more susceptible to emotions.

Recommendations for choosing the optimal trading time

For the stock market, Forex or cryptocurrency exchange, we can give advice on choosing the optimal time:

• Enter the market when there is usually high volatility and work strictly according to the trend: if the asset is growing, then buy, if it is falling, then sell.
• Take into account the peculiarities of your body: if you are used to working in the morning, trade during the day; if you are used to working after lunch, make deals at this time of day.
• Try not to enter at the very beginning and end of trading sessions: at this time the market has not yet decided on the direction of movement and often white candles quickly change to black ones and vice versa, in general, false movements are observed.
• Avoid entering the market when there are holidays in the US or London: you are almost certain to experience low volatility or speculative false moves from local big players.
• An asset is volatile precisely during its trading sessions: the euro during the European session, the dollar during the American session, the yen during the Asian session, etc.

And one more important piece of advice – do not lose your vigilance. Remember that if at certain hours there is almost always low volatility, it does not necessarily mean that it will be forever and there will be no strong movement today.

The value of an asset can change quickly at any time. The chart shows how a market that has been calm for a month suddenly grows sharply.

Explosive price growth in a calm market

The Importance of Timing Trading Trades

Choosing the right time is, although not the main, one of the main factors of successful trading. There are several reasons.

Firstly, this will allow you to identify periods of maximum volatility, when, having “ridden” the asset, you can “ride” along with the market on a strong movement and skim the cream off the profit.

To do this, you need to know the opening and closing times of trading sessions, the period of release of important economic data, reports of major corporations or events specifically for the asset you are going to work with.

Don’t forget to analyze support and resistance levels , trend lines, and a suitable indicator – they will help you determine the correct entry point and the likely strength of the movement.

Secondly, choosing the right time will give you the opportunity to trade in an optimal physical condition, in the life rhythm in which you are most active, concentrated and productive. This will allow you to better manage your emotions, maintain discipline, and you will respond to events more adequately.

Thirdly, choosing the right time will prevent you from being distracted by secondary matters – it will help you concentrate at the right moment and not miss the beginning of a strong price movement.

Choosing the right time to trade on the stock exchanges is part of success. You need to choose volatile segments, but with a pronounced downward or upward trend.

Avoid trading in the first and last minutes of the opening of sessions, when price fluctuations are often chaotic – even an experienced trader can get trapped. Do not forget about financial discipline. Then the right time will help you earn good money on the exchange.