Is Monday Good or Bad to Trade? Mondays are not as effective with the way people trade.
For safe trading, it’s better to relax and watch market moves this day.
Expert traders watch and wait for how Monday unfolds. Is there any reason not to trade that day? Read this post to uncover all reasons to think Monday is not good for trading.
Why don’t people trade on Mondays?
There is no clear-cut rule to avoid trades on Mondays. This decision mainly depends on what type of trader you are. The main reasons for not to trade that day are low volatility, unpredictable market conditions and less number traded volumes.
It’s a reality that Mondays and Fridays are different from other weekdays.
The better way to stay in the market during these days is to expect little and trade low volume. However, it’s also the fact that not all Fridays are slow.
Is It Good to Trade on Mondays
No, it’s not ideal to trade on Mondays. The reason is low volatility, unpredictable market flow, less activity, or low traded volume.
Moreover, expert traders would never advise scalpers or swing traders to trade on Monday morning and Friday’s Noon.
Market closes in different time zones in Asia, London, Europe, NY, and the US. Similarly, its activity time varies with the time zone.
Smart traders wait to see how Asians react to the market, how the London session opens and how NY responds to the weekend market.
So, it’s better to wait rather than trade on Monday.
Why Is Monday a Bad Day Forex Trading: Reasons
You might have heard “never trade on Mondays”. There are several reasons that make Monday a bad day to trade forex.
Let’s read out the 7 Reasons Of Not Trading On Mondays:
Currency Market Is Static on Monday
After Sunday, the market needs time to revive its flow. And the flow of currency trading mostly picks up slowly.
It is the time when traders are busy analyzing things and market direction. They enter the market when it goes in their direction.
It’s better to wait for an ideal market situation.
Market Trend Is Not Confirmed on Mondays
Another reason for not trading after the weekend is that trend is unpredictable. No one can tell exactly whether the market will follow the previous trend or go with a new entirely different trend.
This scenario is not ideal to trade currency pairs. The best policy is to” wait and see”
Trading on Monday Is Risky
No Idea in which direction the market will actually go on Mondays. This fact makes this day highly risky to trade.
I have heard many expert traders avoiding Monday trades. But there are few long-term full-time traders who safely trade on Mondays.
Experts Advise Not to Trade on Mondays
For aggressive traders, Mondays are not ideal. Experts advise scalpers to stay away from Monday trading.
However long-term full-time traders can hold on to certain positions throughout the week. They know how to play safely.
Statistical Data Goes Against Monday Trading
Statistical resources say that low volume trades on Monday. When you analyze the weekly chart of a particular currency pair, you can see low volumes traded on Friday and Monday.
That’s why it’s not good to trade that day.
Even A Good Trading Strategy Can Fail on Monday
Many expert traders complain that their strategy fails on Monday. They make more losses as many positions go against them.
While some experts say that it’s better to trade on Monday but expect less from the market that day.
Monday Is Least Volatile Day to Trade
Time zone plays a vital role in daily volatility. When the market opens in Australia, it is still closed in Europe and the US.
When traders enter the market, he faces low volatility.
The number of active traders in the market is very low. European traders wait to see market direction before opening any order.
That’s why Monday is the least volatile day to trade.
Days to Avoid Trading Forex
Not only Mondays are bad days for trading, but Fridays are also not good. When Friday night approaches, it’s the closing time of trade in many countries. The activity in the market decreases and almost ends at 17:00GMT.
Monday morning and Friday Noon are especially sluggish to trade. During this time, TA and other signals are less reliable. But it’s not logical to avoid trading.
If you look at the volume charts of futures you can observe the real difference. Friday and Monday’s mornings show a marked decrease in volume.
But all this depends on what type of trader you are. Below is Table to See the average Pips move during Week.
The Best Days of The Week to Trade Forex
Curious to know what are the best days of the week to trade forex?
The middle of the week from Tuesday to Thursday are the best days of the week to trade forex. The reason is that the market is highly volatile these days. More and more participants take part in the market activity.
It’s true that 90% of day traders earn during Tuesday and Wednesday.
It does not mean that they totally stop trade on Friday and Monday. They do a trade but open small positions.
However, no day is good or bad for trend followers. They will trade when there is some important economic news.
Obviously, there are tremendous reasons of Why people don’t trade Mondays. It should never mean not to trade throughout Monday and Friday.
There are certain times on Fridays also when trend followers do the trade.
There is no hard and fast rule that stops you from Trading on those days. It’s all about risk management and plays safely.
Day traders who know the tactics to handle the market in unfavorable conditions, trade five days a week. Do you trade on Fridays? If yes, tell us about your experience!