Best Hours to Trade: Find the best trading opportunities.
Markets are open around the clock these days.
This means you too can trade around the clock. You can work full time and still be a day trader in the evenings.
But no two hours are the same, and you can get in big trouble assuming that ever hour is equal in opportunity.
This is why I want to share you with you the most opportunistic times to trade stocks, options, currencies and commodities.
You can then pick the right product to trade in based on when you are available.
It’s all about adapting the market to your schedule, not the other way around. Trading is a very flexible job.
In this article we will reference the times in Eastern Time Zone.
Best Hours to Trade – Stocks, Options, Equity Futures
Let’s start with the most widely known product – trading the stock market.
There are stock markets around the world and most likely in your country as well.
But in many stock markets there is very little liquidity (due to few shares traded) and volume. This leads to manipulation, bad fills, and more. Learn more about liquidity in this article.
Generally, you want to avoid stock markets that most traders are avoiding as well.
Here are the top 5 stock markets by market capitalization (total US$ value of all stocks combined):
- New York Stock Exchange – $22.9 trillion
- Nasdaq (US) – $10.8 trillion
- Tokyo (Japan) – $5.67 trillion
- Shanghai (China) – $4.02 trillion
- Hong Kong Stock Exchange (Hong Kong)- $3.93 trillion
- Honorary mention: Euronext (Eurozone) – $3.92 trillion (6th place) but it is a very good market for day traders!
Of these markets, you can clearly see that the best opportunities for stock market trading is in the United States.
US stocks trade from 9:30AM to 4:00PM EST.
These markets are traded by traders around the world.
The best hours to trade stocks in the US session are between 9:30am to 11:30am.
This is the time period between when US markets open and when European markets close. The overlap is most liquid and full of volume.
Another good time to trade is between 2:30PM and 4PM EST – but this time zone is much trickier for new traders.
The options market in the US is the most liquid during this same time.
US index futures are also most liquid at these times and are best for day trading. (Learn how to start day trading in this article.)
If you cannot trade during these times for whatever reason, move on to the next category.
Best Hours to Trade – Metals
The metals markets are most actively traded in the London session on the London Metals Exchange.
Of all the metals, my favorite are the precious metals for day trading. Precious metals are gold and silver.
Both gold and silver futures also trade on the Chicago Mercantile Exchange under the futures symbols “GC” and “SI”.
These contracts are very liquid, but require higher day trading and overnight margin than other futures.
The best hours to trade the precious metals markets: 9AM to 11AM EST (US – EU overlap) and 2AM to 5AM EST (London).
Best Hours to Trade – Energy
Energy markets include crude oil, natural gas and gasoline.
These markets are a dream to day trade because they provide great margin, liquidity and there is a lot of volatility.
There are a few weekly reports that will cause volatility to spike more than usual.
First is the weekly API inventory report every Tuesday at 4:20PM EST. The second is Wednesday mornings at 10:30AM EST.
Both of these reports are tradeable, and we teach you how to day trade them in our day trader course here.
The best hours to trade energy markets: 9AM to 11AM EST (US – EU overlap), 1PM EST to 2PM EST (pit close) and 2AM to 6AM EST (London session).
Best Hours to Trade – Currencies
Day trading currencies are not my top or preferred choice. (This is why I prefer emini trading over forex).
However, there are many active and successful day traders and they might be a good choice for your time zone and schedule.
Currency trading is also around the clock, which means you will be trading the currency that is in session while you are available.
Here is a forex market session chart:
You can see that London and New York overlap between 8AM and 11AM EST.
But this is also the best time to trade stocks and options. So is forex out of the question?
The chart below shows you the average point moves during each session for each currency pair.
Your job is to find the highest number for your time zone. I’ve went ahead and highlighted my favorite currency pairs for each session.
The higher the average move the more opportunity for you as a trader.
The forex markets are not my favorite for day trading for many reasons, but if they fit your style and schedule then by all means.
We strongly recommend using Desire to Trade Academy for your education needs in Forex trading.
Best Hours to Trade – Conclusion
If you want to learn how to trade you can make it work with your current schedule.
It’s all about finding the best hours to trade during your window of commitment.
You don’t want to be trading in a market when it’s slow, choppy and full of amateur traders. You want to wait for the most volatility and best opportunities.
But most importantly you need to have a trading strategy with a defined benefit and edge.
You can become a day trader and hold for a few minutes to a few hours without overnight risk.
Or you can learn to spend less time in front of the computer and take a more passive approach.
That’s it for today – good luck and good trading.
The information contained in this post is solely for educational purposes, and does not constitute investment advice. The risk of trading in securities markets can be substantial. You should carefully consider if engaging in such activity is suitable to your own financial situation. TRADEPRO Academy is not responsible for any liabilities arising as a result of your market involvement or individual trade activities.