The Forex market is open 24 hours a day, 5 days a week, offering traders a flexibility to trade any time they want. But within this trading window, while there are best times to engage in trading, there are also periods when you shouldn’t be making any move.
Read on to discover the worst times to trade currencies.
First and Last Day of the Week
After a 2-day weekend break, market activity during the first 24 hours of a trading week tends to be low. This is the time when the markets are still figuring out which direction they are heading for the coming week. Furthermore, market participants usually wait for economic numbers to go public during Mondays.
Meanwhile, during Fridays, there’s also lower liquidity as the market starts to wind down. If you’re a technical trader, Friday may not be a good day.
Right Before or After Impactful News
There must be price movements in order to make money in the Forex market. Currency fluctuations are what we call volatility. News like interest rate decisions and non-farm payroll trigger higher volatility in the market. Although trading immediately before or after the release of these events presents an incredible opportunity to earn greater profits, it also presents greater risks.
When You’re Mentally Weak
Trading can sometimes bring you lots of stress and anxiety which affect your ability to make good decisions. This is why the majority of amateur traders lose a great amount of money.
When you’re not feeling at the top of your game, just take some time to rest and recharge. As they say, sometimes the best thing to do is to do nothing.
Bottomline
Timing is everything in Forex trading. If you want to succeed, you have to know the best and worst times to trade in the market. Mondays and Fridays may not be ideal due to lower liquidity.
Also read: How and When to Trade USD/JPY
