Wednesday, 8 February 2017

Worst Time To Day Trade Most Markets

Statistically speaking, the worst time of day to trade is from noon to 2 p.m. This “no trades during lunchtime rule” applies especially to intraday traders. On average, the 30-minute volume and range of trades bottom out during this two-hour window. Bid/ask sizes will be lower during this period and it’s less likely that there will be directional movement. Of course, there will always be outliers that show some market activity to be optimal during this time, so use your best professional judgment. But in general, since all traders need a refresh break, why not take it from noon to 2?

Key Takeaways:

  • One of the worst times to day trade is during the time when many traders take lunch and this is a good time for you to stand aside.
  • The statistics clearly show that the average 30 minute volume and range bottom out between 12-2pm EST i.e. LUNCHTIME. The specific time a particular market’s activity hits it’s low point with its primary session will in fact vary from product to product.
  • These basic statistics give a general feel for what it might be like over lunchtime, but to show the kind of movement, it’s a little clearer in the video below. Again, there are always going to be days when there are outliers in the data and there are some great opportunities during lunchtime.

"Unless your system takes advantage of the volatility surrounding news releases, any day that has a significant amount of important releases (even inventory reports) would be a day you should approach with caution."

Originally published at Worst Time To Day Trade Most Markets

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