Taking Days off to Lock in Forex Trading Profits

The foreign exchange market works 24 hours a day and trades 7 days a week. Most brokers do not offer small traders the option to trade after 4PM on Friday, New York time or before about 5PM on Sunday, New York time. However, the market is still alive and off hours trading does occur. Often it happens in futures and options and these mark how the market will open in a particular currency. Many traders use Saturday and Sunday as a time to catch up on world news and plan the coming week. They study charts and fundamental news, while looking for trading opportunities. So in reality, many traders do not take a day away from the markets and find themselves becoming burned out very quickly.

Typically, Friday trading operates in one of two ways. It is a very volatile day with traders getting rid of positions to keep from having to pay interest carrying charges over the weekend or it is a very slow day with traders waiting on upcoming news over the weekend or the first of the week. In either situation, small traders are at the mercy of price spikes that do not fit normal trading. These spikes can lure a new trader into thinking a large move is coming or that major retracement will happen, when in fact nothing else will probably happen and the market will make a gap opening on Sunday and become a major financial disaster for the uninitiated trader. You would think that if this happens once it would warn traders off, but it does not and every Friday, lose millions of dollars to the eccentric movements preceding the weekend.

By taking Friday off you give yourself the ability to relax and look back at the week with fresh eyes. For most traders, taking Friday off means to close out all your positions before noon New York time if not earlier in the day. The movements we discussed usually begin to occur around 11 am and continue until the close of the market. So you should close out your positions and then shut down your trading platform and get away from the computer for at least 24 hours. This allows you to have a life as well as gain perspective on the work you are doing.

In conclusion, among other reasons to take days off Forex trading, family time is just as important as trading time. Whether your family is yourself and a pet or a large traditional family, it is as important as any technical indicator that you are able to look at your trades with fresh eyes and the only way to do that is to get away from the charts for a period of time. Go running, go shopping, take a nap or read a book about anything but the market so that you are able to get out of the myopic view that many traders develop after long hours, staring at Forex charts. Rested and relaxed traders do much better in the long run over those that are stressed and worried all the time. Enjoy more profitable trading by taking Friday off.

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