Most forex traders may have heard that weekend trading should be avoided because of the increasing risk of loss. Novice traders may often listen to this suggestion a lot.
Do you believe in this myth?
It makes no difference trading on weekends or weekdays. It all depends on the strategy and method you use.
According to Day Trading, you definitely can start trading online on weekend since weekend trading in binary options, currency, stocks, CFDs, and futures is growing rapidly.
Weekend Phenomenon: Gap
Generally, the gap is a large difference between the closing price of the weekend and the opening price at the beginning of the following week. Thus, the opening price at the beginning of the following week is not the same as the closing price. The gap can be as small as a few pips, to infinity.
Why do gaps occur?
This is because the value of a country’s currency is influenced by many factors. For example, economic, political and other factors related to activities and events experienced by the country concerned.
These various kinds of events certainly do not know the name “holiday”, so that inevitably continues to run and occur, even on weekends, when the market closes.
Well, sometimes special events or events can cause a country’s currency to surge or plummet. So, when the market opens at the beginning of the week, there is a spike or a bump in prices on one pair. That is what we often refer to as a gap.
Then, how do we respond to the possibility of these gaps?
Well, it goes back to the trading style of each trader. Many traders prefer to avoid the gap so they tend to close positions before the market closes. Some leave a position open on weekends, it’s just protected by Stop Loss or hedging/locking.
Moreover, some of them seek profit from the expected gap by placing a pending order just before the market closes. Everything returned to the tastes of each trader. You are free to choose whether to avoid, face or even look for this gap. So are you going to have a weekend trading? Yeah, why not. If you already know all the risks that might occur, it all depends on us.
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