Last Monday was the US Labor Day public holiday.
So I was surprised to see an email on Tuesday from a trader who was caught unaware by the low volume.
Here's an excerpt from the email:
- "Today was some USA holidays (I did not even know it) and most of the markets were completely dead and made small range during whole day."
You absolutely MUST be aware of the holiday schedule, as it relates to your market.
Any decent economic calendar should show them.
I use this one (due to my trading journey coming through the forex markets a few years back) – http://www.forexfactory.com/calendar.php. It's not the only one. Search around for some alternates and find the one that best suits your market and your circumstances.
Some people like to trade every day. That's cool. We all get to make our own decisions; and alongside that have to accept responsibility for the outcome. If you're net profitable on holiday sessions… good on you. I just don't think the risk is worth the effort.
There are days when you should NOT trade.
For me, these days are:
- All US holidays
- Any other holiday relevant to the instrument being traded (eg. UK holidays for GBP/USD)
And there are days when you should trade cautiously (and even consider not trading). For me these are:
- A couple of hours prior to any significant news release (such as NFP or FOMC… or market specific releases such as the Crude Oil Inventories report for CL)
- The day before holidays or long-weekends (or at least just the afternoon of these sessions)
- Rollover day (for futures)
There may be others applicable to your markets. Options expiry days are one that some people avoid.
Take some time out this weekend to update your trading plan to (a) check the economic calendar on the weekend (for the upcoming week) and again pre-session (for the upcoming session), and (b) document which days you will avoid, and which you will trade cautiously.
Happy trading (or not… on certain lower probability days),