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Hey, day traders, it’s Marina the trader chick. And today’s big question and simplifying hack: when to trade?
What time of the day is the best time to trade?
So stick around because going to let you in on exactly the best time to trade. But before we do, subscribe below, hit that notification button because every week I’ve got a new simplifying day trading hack and tip for you.
Okay. In the past, I have talked about how many trading days in a year. So you want to know when to trade? What time of the day is the best time to trade? But before we do that, let’s first find out the different sessions that actually exist in the day for you to decide when is the best time to trade. And I’ll tell you when I think is the best time to trade.But before we go any further.
I have to add that basing your trading plan and strategy on time of day is quite important, but even more important are the day trading principles and knowledge of market movements you need to have in order to become a profitable trader.
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Table of Contents
Best trading sessions
Premarket
What is premarket? It doesn’t matter where you live in the world. There is a time when the market opens and starts to trade. Right.
Since I am from the US and I mainly trade the US market, obviously everybody knows it’s 09:30 a.m. Eastern time. So when is pre market for that particular time zone?
I like to look at it from 7:30 till about 9:15 in the morning, right. Because 9:15 is when the transition starts to begin, and it starts to become a little bit more erratic or more indecisive.
So from 7:30 till about 9:15 is a really good time. The thing is, with Pre- market, you also have to remember there’s a lot less people in the market. So when you know that, you know that the volatility, the volume is going to be down so you can’t expect it to be moving super quick, right?
Because you understand that it’s a Premarket. Also, don’t forget to look at the high impact news items just because it’s Premarket does not mean that a high impact news item might not affect it.
So remember 7:30 till about 9:15 in the morning. That’s usually around Pre market time.
Commonly Asked Questions about Pre-Market
When are pre-market hours?
Generally the U.S. stock market exchange and in particular the New York Stock Exchange (NYSE) and the Nasdaq are open 9:30 a.m. and 4 p.m. Eastern Time (ET).
Pre-market trading typically occurs between 730 a.m. and 9:30 a.m., though it can begin much earlier – as early as 4 a.m. ET.
Why trade pre-market?
The advantage of trading in the pre-market session is that price volatility is reduced to some extent. sS traders can make the most of trading while other factors have minimal influence on the price of stocks.
Can anyone trade pre-market?
Yes, it’s open to pretty much all traders. But it depends on your trading account and which brokerage you use.
Where can I trade pre-market? Which brokers?
Several brokers allow pre-market and after-hours trading. Some of the most used are:
- Charles Schwab
- Robinhood
- Fidelity
- WeBull
- E*Trade
- TD Ameritrade
Related Read: Can You Buy And Sell a Stock In The Same Day?
Morning Session
Then the morning session. Right. That’s when the markets open up.
I like to think of the morning session. Actually, it’s not just not me. It’s pretty much everybody. Morning sessions are usually from 9:30 in the morning until probably around 11:30 a.m. Noon.
Right. Because right before lunchtime. So it’s a good two and a half hour of morning session. Again, don’t forget that you have to check the news items because they are really important. That should never be taken out of the equation.
So the morning session usually is considered the best time of the day to trade. Why? Because that’s when everybody flows in with the most amount of enthusiasm. That’s when the volatility is the highest. And we love volatility, especially for day trading.
Volatility is a really great way of making it less indecisive. So you go with the flow much more. Right.
It’s also because the volume is just there. Right. So morning sessions are considered some of the best. So morning session 9:30 till around 11:30, noon, and then we have lunch.
Commonly Asked Questions about Morning Sessions
What is the best time to trade in the morning?
Many traders consider the time frame between 9:30 am to 10:30 am the ideal time to make trades. This is because in the first few hours of the market opening there is usually more volatility and volume which gives more opportunities for the best trades of the day.
Is it good to trade early in the morning?
Yes. Trading in the early part of the morning session is often the best time of day trading. During this time you can expect the biggest price moves volatility) in the shortest amount of time.
Many professional day traders stop trading around 11:30 a.m. because that is when volatility and volume tend to taper off.
What is the 10 am rule in the stock market?
This is a rule followed by some professional traders as they believe that the most significant trading volume occurs between 930-10am. Traders that follow the 10 a.m. rule think a stock’s price trajectory is relatively set for the day by the end of that half-hour. Hence we have the ‘10 am rule’ in the stock market.
Lunch Session
The markets don’t close for lunch. It is definitely a session. I think it’s usually around 11:30 till around 1:30. Right. Depending on who is what and when taking time.
But remember what happens during lunch? A lot of people stop trading. The volatility really goes down, the volume goes down. And overall during lunch, it’s a lot of indecision. What does that mean?
It means there’s a lot of sideways movement back and forth. So I definitely don’t recommend it as your number one session, you should avoid trading sideways.
But if it’s the only time you can trade, there are still some great opportunities, but they might not be as often and as frequent as you would get in the other time sessions. Okay. But lunch is definitely still a session.
Common Questions about Lunch Session Trading
Does the stock market stop for lunch?
For US stock market hours, generally most US exchanges do not close for lunch, but there is typically less trading in the middle of the day. And most liquidity for the US session is found at the morning and afternoon session before closing of the trading day.
Do stocks fall during lunch?
There is typically a drop-off in trading (meaning the volume of the transactions) at noon as most of the major news events are out in the market. During this lull, stock prices can often lose some ground.
Afternoon session
This is probably the second and probably tied with the morning session. Why? At this point, you get a whole new group of people coming in sometimes because it could also be from different time zones. Right. E.g. California – that could be their time to get in.
So remember that. And also a lot of people are just taking off 2 hours, so they’re refreshed and they’re ready to come back in. Afternoon sessions are usually between 1pm and around 03:30 p.m.
I mean, yes, you could go until 04:00 p.m. But I call it the amateur hour because that’s when everybody is trying to get out trying to get their losses or gains or whatever. So it could be a little bit chaotic.
So the best time is usually between 1:30 and 03:30 p.m. And this is all Eastern Time that I’m speaking about. And again, don’t forget, there can be news items.
There could be different committee meetings. So you need to be on top of that just the same. All right. So 1:30 to 3:30pm . And it’s my second or the tie to first place as the best sessions of the day as far as volatility volume and movement.
Commonly Asked Questions about Afternoon Sessions
Is it good to trade in the afternoon?
Many day traders believe it’s good to trade the last hour of the day, from 3 to 4 p.m. EST. as by that time, traders have had a long break since the morning session, allowing them to regroup and regain their focus. The last hour can be a lot like the first when you’re looking at common intraday stock market patterns.
Is the afternoon session as active as the morning session?
Generally, the morning session tends to be more active and volatile compared to the afternoon session. However, the afternoon session can still see significant trading activity, particularly around market-moving events or news releases.
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Night Session
But there’s more. We’ve got the night session. That’s right. Night session. Guys, don’t forget there are a lot of people that trade in the night, but there are not that many people.
So what does that mean? It means that the Volatility and the volume are really going to drop. Right. Depending on your market, you can have a third of the number of people that normally would be during the normal hours. So just remember that.
And in this case, when you come into the night session, you’re prepared because each trade that maybe during the morning session and afternoon session was only like five minutes could actually take over an hour or more during the night.
So as long as you are mentally prepared, you can enjoy the night session as much as you can any other session. So remember that now the real question is when is the best time for you to trade? It’s one thing knowing the best time of movement and volumes.
But if you can’t do it then it’s obviously not the best time for you.
Most Common Questions About Night Session Trading
Can trading be done at night?
The overnight trading hours for NSE are from 3:45 p.m. to 8:57 a.m. For trading derivatives such as futures and options , the overnight trading hours are between 3:45 p.m. and 9:10 a.m.
What time does night trading start?
Overnight Trading Hours for US stocks and ETFs are from 8:00 pm ET to 3:50 am ET, with the first session beginning on Sunday at 8:00 pm ET and the last session ending on Friday at 3:50 am ET.
Trades executed between 8:00 pm ET and 12:00 am ET will carry a trade date of the following trade day.
When is the Best time of the day for you to trade?
So you decide when is the best time for you? When can you allot stress-free time to sit in front of the market. That is the best time for you to trade. And that’s the real question that you should be asking yourself. I’m Marina the trader chick.
I want to know when is your best time? When do you guys normally trade? Leave it down below in the comments and don’t forget to subscribe and hit that notification because I’ve got new. Awesome Simplifying Day Trading hacks and Tips for you weekly.
What is the best time of the day to trade? Final Thoughts
So I hope this post has been helpful for you in learning about the different sessions for trading and when the best time of the day is to trade. And while choosing the best time of day to trade is vital, just as vital is your trading knowledge and technical skill and as always often the best approach is to simplify your trading and technical analysis in order to become a profitable trader.
And as I discussed in the podcast episode the main trading sessions you should consider when choosing a time to trade are:
- Pre-Market 730am-915am
- Morning session 930am-1130pm
- Lunch session – 1130am – 1pm
- Afternoon session – 130pm-4pm
- Night session – 4pm – 8am the next day
And as I ended my podcast above with, the best time of the day to trade is often really based on when a trader has time where they can fully concentrate without distractions to sit down and trade.
But generally speaking, as discussed above the morning session is a favored time to trade for most traders because of the high volatility.
Afternoon sessions are also very popular as there is liquidity and volatility during this time before the market closes for the day.
