Be a full time trader doesn't mean you have to trade all the time, a couple of hour per day is sure enough. The market trade time is something like this:
1. First hour trade can almost depict whole day trend. We can divide the first an hour into 3 session, early, middle, late. If the whole day trend is away from the first hour trade trending, it means the big gap or difference away. We have to pay special attention to that.
2. Mostly the time is as follows:
Premarket:
Lower volume, some index disclosed, or yesterday's after market earning/pre-marketing earing released, big fluctuation in the price, high risk to get position or sell. Some website will send out emails around 8:30 to forecast the market trend, key reports, calendar, earnings report, basically based on the futures, global market index, commodities, gold, gas, currencies... which is really for all of us to pay attention and know what happened and what will happen today. Anyway, it s high risky and I do not normally do any trades at this time.
9:30- 9:45 :
Agent to put the order for customers order, if you have Tier 2, you will see a lot of orders are put. Institution will normally get into the market after 9:45.
10:00- 10:30:
Critical time, a lot of numbers, index are released, which will decide the wind of the market. A lot of critical convert (up/down) trend up or trend down start to show. Bullish/bearish sides' fight start. Therefore, the first hour is always the most important hour for me to keep close watch of the market. Most of the day traders focus on the first hour to make their trades and take profit.
11:30-1:30:
Lunch time!!! Break time!!! Normally you will see slow motion and low volume. Every one need to eat, so do I. Take the time to review some comments from the website, google, yahoo. wsj, IBD, have a cup of coffee.. yeah, by the way, i quit my Coke, which I used to have more than 3 a day. ( 1 can of Coke = 18 spoons of sugar).
1:30 - 2:30:
Battle resume again. Agents keep on customer orders.
2:30:
Critical time. Institution in ,the time may start from 1:30.. A lot of change, reversals occurs. Super computer programs, time triggers. If I see big trend or wave happen during this time, i am not surprised.
3:00- 4:00:
Day trader time!!! Especially the last half 30 mins. Recently we saw a lot of selling off or buying happened during this time period. Yeah, that is right. Day traders do not keep position over night, including some institutions. It causes the market widen up and I am not surprise to see sometime my profit is totally wiped off, which is very annoying, and put the potential risk for gaps for next day's opening price. For DOW, 50 points or 100 points up or down during this time periods is not odd for recent market. Selling off or buying from big institution may misdirect the individual investor to blind follow, which will push the market toward down or up further. However, this is also a good time for day trade to maximize profit if the judgement they make is right. I always wish that I could be on the lucky side. Even though I am not doing day trading, I use this time to practice my estimating and price support/resistance test, which is not a bad idea.
4:00 - after market
not much activities, unless some companies have earning, big news etc, which will cause big move in the stock price after hours. I assisted one profession on stock research and he always asked me to keep records of the after hour price for his portfolio, which now it is my habit to keep watching the after hour price as well. Some website focuses on the after hour trade as well. Personally, I like the midnight trade.com. But it asked for subscription and it costs money, as always. There is no free dinner in the world.
Wow, I never think I will like to put this into blog.. it s in my brain. If my daughter can read this after 5 years and understand what I am talking here, i believe it worth it. Otherwise, it s nothing.
Good weather today. And it's the Final World Cup between Netherlands and Spain. I know little about them. TV is on and just curious to know the results.
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