When to Trade

One of the key elements of any trading system is market timing. Many traders fail to account for timing when making trading decisions, and those who do often rely on their instinct of market timing rather than empirical data. The sophisticated investor uses advanced timing techniques to optimize market entry and exit.

ANALYSIS

• Hour: Which hours of the day will produce the best trades?
• Session: Which trading session has the most action?
• Day: What is the range for particular days of the week?
• Month: Do the days of the month differ?

ACTION

• Correlate your engines to optimal trading ranges
• Test your engines according to a specific entry schedule

RELATED MATERIAL

Test-drive FX Engines for free online at www.fxengines.com to see the power of system building, system testing, and system automation.

ABOUT THIS REPORT

The Forex Report is a periodic publication that investigates advanced strategies for superior trading performance in the foreign exchange markets. These reports utilize advanced statistical and econometric modeling techniques to create new insight into the trading strategy of the average trader. This Data Brief, When to Trade, is intended for all audiences, including those new to the forex market.

To learn more about The Forex Report or to register for delivery of all future reports by email, including Case Studies & Data Briefs, please visit www.fxengines.com.

ANALYSIS

When to trade? We wanted to be sure ourselves, so we took 4 years of historical tic data from a dealer and ran it through a rigorous econometric analysis. The most basic results of that analysis show the importance of understanding and employing timing in your entry and exit decisions.

WHEN TO TRADE: Hours of the Day

Average range in pips for the four majors, Eastern Time:

WHEN TO TRADE: Trading Session

Average range in pips for the four majors:

WHEN TO TRADE: Day of the Week

Average range in pips for the four majors:

WHEN TO TRADE: Day of the Month

Average range in pips for the four majors:

IN-DEPTH STUDIES

More advanced results from this study will be available in later Reports, Case Studies, and Data Briefs. Register at FX Engines for free to receive these future reports.

RELATED MATERIAL

For more information on “When to Trade” see The Forex Report: The Six Forces of Forex, at www.fxengines.com.

ACTION

Create trading systems that are timing-intelligent, test them, and roll them out into live trading. FX Engines’ entry schedule tool gives you fine control over the entry of your trades, and allows you to use sophisticated trailing exits, fixed exits, limit exits, and/or exit signals to manage your exits.

Once you’ve created your engine with timing intelligence, begin historical and live tests. FX Engines will be offering live trading through a leading dealer shortly, so get started testing today with our Free Trial and be ready for our live trading launch, coming soon.

MORE INFORMATION

For more information about The Forex Report, visit www.fxengines.com or email info@fxengines.com. The Forex Report is available for distribution on third party websites as a co-branded offering. Contact us for more information.

THE FOREX REPORT

Analyzing statistical, econometric, and behavioral trends in the foreign exchange markets for insight into the optimal use of the FX Engines automated trading platform.

The information contained in this report is represented without warranty or any statement of its veracity. The contents of this report are intended to stimulate thinking on issues related to trading forex. This report does not suggest any particular action that could be utilized in live trading for profit or loss.

I can put it no better than Hoffer, who deferred to Montaigne:

“All I say is by way of discourse, and nothing by way of advice. I should not speak so boldly if it were my due to be believed.”