Forex Trading How To Avoid The Worst Times To Trade [+When To Trade Instead]
Do you know when the worst times are to trade and when you should actually be trading? If not, then you’re in the right place!
I will show you in today’s trading lesson, you shouldn’t be trading when… you just aren’t psychologically ready to trade, and why you shouldn’t trade around any high impact news events.
Plus… two days of the week I just won’t trade anymore!
We all want to know when to to buy or sell a market.
You could say this has become vastly the number one thought many traders have even before opening up the charts.
Even though, this is a crucial part to a traders success. It’s also just as important for a trader to know when not to trade as much as when to take a trade.
What do I mean?
Lets take this as an example…
You’ve been following the GBPUSD pair for some time, its got to a perfect location at a key level of support.
Then a nice looking pin bar forms of the support.
Everything looks perfect!
It’s the end of the week, Friday in fact.
Now this isn’t going to be a good time to take the trade. The setup is spot on, but your timing is off!
If you don’t consider these factors before taking a trade, it could potentially be the deciding outcome of a winning or a losing trade.
What I’m going to share with you in this article today, are my top 3 suggestions on Forex trading how to avoid being crushed by the markets.
1. Forex Trading How To Avoid When You Aren't Psychologically Ready
Forex trading is one of the toughest businesses to be in, mentally it can be one of the biggest challenges you will ever experience.
Without a strong mental discipline towards your trading, you will soon find yourself in a sticky situation.
If you are able to keep your emotions under control, you’ll most definitely find yourself ahead of the game.
You know what happens to those traders who can’t.
however disciplined and under control you are with your trading. There are going to be those days!
I get it…
I’ve had those days too, you just cannot escape them.
Days where you’ve not had enough sleep, or busy with other tasks. Even when your feeling unwell and you find you can’t concentrate.
There’s no getting away from this, we all have them!
So what I suggest…
Whatever the case, it’s best just not to trade at all on those days. Especially if you’ve had one of those days where you’ve had 2 more losing trades.
This is one of the worst mentalities to have when trading. As you are then revenge trading, you know what I mean.
We’ve all been there done that and have the T-shirt!
In fact, I have a great article I only wrote the other day, all about making money in Forex trading with learning to avoid your emotions first.
I suggest you check this one out after reading today’s article…
2. Don't trade Immediately Before Or After High Impact News Event
This can be another time traders fail to see the bigger picture. When it comes to Forex trading how to avoid getting caught up with news events.
I’m not saying news events are actually a bad thing, as you won’t make money Forex trading without the liquidity that news brings to the markets.
How does this help with Forex trading how to avoid the worst times to trade?
Without the news the markets wouldn’t move, and then you wouldn’t make money. So news will help to move the markets allowing us to profit from these movements.
Myself included, you’ve all been caught in a trade that all of a sudden moves heavily into your direction and reaped the rewards!
Those are great trades, that run for 100’s of pips and there’s no better feeling then capturing one of those trades.
But this can also be incredibly dangerous to the new trader. Not understanding how the markets move and when high impact news events are happening.
Why is this?
just as easy as it is to see increased profits out of thin air while in a trade.
See where I’m heading with this?
Things can take a drastic turn against you as well.
High impact news events such as rate decisions and non-farm-payroll can cause high volatility in the markets.
I’m sure just as I have…
you’ve attempted to try and trade one of these events early on in your trading career.
Yes, you can make money but price can move so incredibly fast on these high impact news events you can also lose a lot incredibly fast too!
It all comes down to having a trading edge within the markets.
When trading in this style you most definitely won’t have any type of an edge.
There’s never going to be an edge when trying to trade the news, so this is exactly why you should never trade immediately before or after a high impact news event.
So my solution to this…
Always wait for a Daily close at 5 pm New York EST when trading the Daily charts, before deciding on any trade decisions.
Yes it’s a simple solution, the same applies to the 4-hour time frame always wait for the next candle to close.
Waiting for the candles to close at this stage will allow you to make a valid trade decision.
It’s also going to allow you to check for any high impact news events before taking a trade.
Here lays a traders discipline and patients when looking for a trade.
So always wait for your trade setups, don’t ever go chasing for a trade especially around high impact news events.
If you need a New York Daily close broker you can find one I highly suggest by clicking here.
3. Don't Trade On Mondays Or Fridays
If you recall as I said early on in today’s article, with the GBPUSD trade example that all looked perfect.
It was the end of the week, making your timing off with taking this trade.
Not only can it be a bad time to trade at the end of the week, it can be just as bad timing if you look to trade at the beginning of the week.
So why does this matter?
When it comes to Forex trading how to avoid getting caught into losing trades.
Avoiding the start and the end of the week can very well help you from this heartache.
I get it…
I used to trade on both Mondays and Fridays, but soon realised these where my worst performing days of the week.
The reasons behind this is a simple one.
Traders have just had two days off from trading the markets, with them being closed at the weekend for 48 hours.
So it’s going to be a slow start to the week, as traders are only just getting back online and trying to figure out which way to expect the next move to head.
Because of this reasoning I now tend to stay out of the markets on Mondays.
Now of course, if I have open positions I will check on these during this day.
Not many traders will share this information with you, there’s a common saying that most successful traders know.
“Retrace Mondays and trend continuation Tuesdays”
So if you’ve been following a setup towards the end of the week. It’s going to be best to wait until Tuesday before taking any trades.
Forex trading how to avoid losing trades at the end of the week.
At the other end of the spectrum we have Fridays.
Just as with Monday when the start of the week has lower liquidity with traders having a weekend break.
Fridays will often also have this lower liquidity with traders closing out trades and cashing up from the current week.
Another valid reason why I won’t take new trades so close to the end of the week.
Is with leaving trades open over the weekend. Now, of course trades opened earlier on in the week is fine.
But, opening a new trade so close to the end of the week, with less liquidity and possible market gaps over the weekend break.
Is setting yourself up for a possible losing trade!
With the idea of having a open trade over the weekend without any control at all for 48-hours doesn’t appeal to me.
Does it you?
So… those are my reasons why I will not trade at the beginning or end of the week.
My much preferred approach is to always only open new trades between Tuesday – Thursday.
I highly recommend you look at trading these days only as well. As using this approach will increase your ability to have a higher win rate.
Wrapping this up…
Any valid set up during the 3 days from Tuesday to Thursday are going to fair game.
The only time I would look to trade Mondays is only with what I call retracement Mondays.
But, that’s for another day!
Fridays in my book are a complete off limits, just don’t put yourself through the unnecessarily stress.
So knowing with Forex trading how to avoid when to trade or not to trade is going to be crucial to your success.
You now know that trying to trade with the wrong mentality and mindset is setting you up for a hard fall.
Especially more so if you are trading frustrated or revenge trading.
Best thing to do is take time away from the charts, until you are more focused and feel up to the pressures with Forex trading again!
Don’t trade immediately before or after a high impact news event.
It’s just not worth the pain it can cause you, not to mention effecting your mentality as a trader with your emotions.
Check before you take each trade if there is a news event, and wait for the Daily close at 5 pm New York EST.
Always wait for the 4-hour candle to close before ever taking trade, giving you the ability to check before hand for any upcoming news events.
Finally, don’t trade at the beginning of the week and most definitely don’t trade on Fridays!
Especially taking risk on a Friday and holding it over the weekend is not going to be good risk management.
But, I have found trading from Tuesday to Thursdays will give the best trading setups.
If you follow these simple rules with your trading, it’s going to help you avoid the worst times to trade.
Want to see what other Forex trading education I have, then click here now.