Trading Forex on Sundays

[daiello]

I have been told to be very careful trading forex on a Sunday. Can anyone give me a more in depth answer to why its called pick your pockets Sunday?

[ForexWolf]

Originally Posted by daiello

I have been told to be very careful trading forex on a Sunday. Can anyone give me a more in depth answer to why its called pick your pockets Sunday?

Well on Sundays you have a lot of things goin on--markets are not quite opened up yet--so whippyness and gapping on open is quite possible. Forex often trades without a firm direction or goal on Sundays. Its good for a quick scalp trade or two--but if you have goals of 40-80 pips or doin some long term trade positioning, its very rare you see that kind of move on a Sunday open.. Not saying its not possible to get into trades on Sunday and do well IF you PLAN them out and protect yourself--I'm just sayin its often very unstable and whippy the first few hours...

Usually what happens at opening is folks having second thoughts try to exit positions they held over the weekend from the previous week, and new folks try to enter in to catch a correction or continueing move, based soley on the moves from Friday or last week--which often is not productive.. So you get a lot of unstructured buying and selling which often tosses the markets a bit into whippyness. Plus you also have markets making corrections from the previous close and adjustments from any news or happening on the weekend will often occur as well.. This is why its not the best method to hold a position open over the weekend--gaps can happen, and can either do you a great service to be in your favor, or they can visciously kill you. I once took a -130 pip loss for stupidly holding over the weekend and the pair I was in gapped at open against me and continued to go against me. It blew past my 50 pip stop loss (and since it was not ticked but gapped--my stop did not trigger--check your Terms and Conditions with your broker--if it don't tick and it gaps, it dont' count!!) and I ended up eating the loss for being stupid.. Yes--I make and have made tons of stupid mistakes when I started out....but I try to only once... :D

Think of it this way--Its not unlike a drag race car getting to the starting line and revving up and then pulling back hovering around the starting line... Many traders may make a Sunday open trade--do great and hold--and suddenly the position turns on them and they are at a loss.. Sunday open is often very unstable, whippy and often has no main influences.. Doesn't begin to settle in until London begins its open--and then you start to see some moves and solidifications and a more stable and tradable market...

Hope this clears some stuff up for ya....
FXW

[daiello]

So in your opinion, is trading on Sunday unsafe to new traders?

I picked up some positions on Friday before close because i liked how the chart was looking. I hope i didnt screw it up, but as of now they are doing pretty good.

[ForexWolf]

Originally Posted by daiello

So in your opinion, is trading on Sunday unsafe to new traders?

I picked up some positions on Friday before close because i liked how the chart was looking. I hope i didnt screw it up, but as of now they are doing pretty good.

Its not so much that it is unsafe--its as volitile and risky potentially as any other day--the problem comes in the gaps and any unexpected swings that can occur without warning or seeing the "why's". During the week you can better plan and work trades based on assessing the news and the charts--but on Sundays the markets are gearing up for a new week with new news and info--and tryin to finish digesting the previous weeks information and make any adjustments. I'm just saying that for new traders it can be whippy and more difficult to predict or understand why it moves the way it does..and easy to get blindsided.

If you're doin great in some positions you held over the weekend and things are in your favor--awesome and good job! Just remember that making the pips in Forex is often easy--what is difficult and takes practice is to KEEP those pips you gain, and know when you have gained all you potentially are gonna gain from an open trade and move on.. Trading is not all about the gains--its a lot about minimizing risk exposure and potential, and the safe management of that risk...

FXW

[daiello]

Well i had such a crappy day.

my short GBP USD sucked, down 50 pips, closed that since it broke away from my trend lines.

my long USD JPY, is down 20 pips or so. I have it sitting on my support line now so should continue up,

and my short XAU, i dont want to talk about haha

[ForexWolf]

Originally Posted by daiello

Well i had such a crappy day.

my short GBP USD sucked, down 50 pips, closed that since it broke away from my trend lines.

my long USD JPY, is down 20 pips or so. I have it sitting on my support line now so should continue up,

and my short XAU, i dont want to talk about haha

It was a general crappy trading day overall and many pairs are tightly bound not doin much of anything today...so you're not alone...

Only 1 of my trades worked out as planned and triggered--now its up to the Bank of Canada to do something or not to move it; 1 trade I had considered but did not take did exactly what I thought it would--and I was not in the play to reap the pips which irritated me all morning.. 1 of my EUR/USD trade plans I was sure would have moved today did not even come close to triggering my entry, and I abandoned the whole idea after lunchtime to re-assess later....and my EUR/JPY play triggered finally late in the day and is down -10 pips....but still has potential.. But such is the life in Forex...cannot let it get to ya and ya cannot dwell on it. Not every trade works out 100% perfectly...just take it day by day and move forward to new plays as they present themselves...

FXW

[daiello]

I think we should start a new thread about entries and exits.

Cause right now i'm down about 40 pips on my long USD JPY and not sure if i should stay in.

Looking at my one day chart i see it still hasn't hit the bottom trend line so i could still be safe. Maybe once it drops that i should sell out.

Your thoughts?

[ForexWolf]

Originally Posted by daiello

I think we should start a new thread about entries and exits.

Cause right now i'm down about 40 pips on my long USD JPY and not sure if i should stay in.

Looking at my one day chart i see it still hasn't hit the bottom trend line so i could still be safe. Maybe once it drops that i should sell out.

Your thoughts?

Well FWIW I hate the USD/JPY pair--its irritated and frustrated me a lot over the years.. EUR/JPY is the only yen pair I play. Technically the $/JPY is a very tough pair to call and take plays on, because its reactions and moves are not based on news or data, but a lot of speculation and "posturing". By posturing I mean that it often will move in counter or response to seemingly unrelated or unconnected reasons to JPY. What I have figured out thru a lot of trial and error over the years, and lots of reading, is that the Yen is a more 'reactionary' currency based on the decisive effects of other countries--not based on its own country or interests... There are only one or two econ news reports that even have a chance at effecting it....

The pair I noted in my previous post in which I did not take the trade, that did exactly what I thought--was the $/Yen.. Last nite it seemed to me a SHORT play on it from 123.65 down to 123.20 was setting up...with a possible test lower...and sure enough overnite it dipped from 123.65 to 123.25and ticked me off this morn...because quite often when I try a play on the pair it will take much much longer to move then I would expect normally, and often will flounder about before doing anything. Habit for me is often to paper trade and watch the $/yen in my ever quest to learn how to figure the advantages it must give for trades...

Based on charts of the $/Yen, and the MACD and CCI, it seems a test to 122.50-122.60 area is the bounce and support point and where the pair is gonna go...IMO....but as I said--making technical calls on this pair is often very very difficult to nail down for time frame or certainty at best by comparison to other pairs. If it breaks 123.00 that is where it will go and bounce IMO....but given the strength at 123.20 area--its a hard call to make on if it will get enough steam to break thru. Not tryin to discourage your position--just giving you my read of the charts. A long trade could work and I do believe it will test up to 124.00--but for me I would want to see a validation point of a level of 123.45 met and held for me to make a long entry and feel better about it....

FXW

[daiello]

Nice post.

I decided to leave my position open, and i get home to see they liquidated my positions.

Down 600$ haha, luckily its only a demo.

But yeah that damn turtle wrecked me, dropped down real low.

[ForexWolf]

Originally Posted by daiello

Nice post.

I decided to leave my position open, and i get home to see they liquidated my positions.

Down 600$ haha, luckily its only a demo.

But yeah that damn turtle wrecked me, dropped down real low.

This is what Demo's are for--the practice practice practice factor...use them and keep at it. The $/Yen is a tough pair to play....IMO...

FXW