September 16, 2015 at 3:44 pm
Time Management is a subject that you don’t see very often in the Forex Trading industry, yet it is just as important as managing your risks are. It is a well-known fact that the Forex market is open 24 hours a day, 5 days a week. When the one market closes, the next one will already be open. Have a look at our Market Sessions article for more in-depth information regarding the different open and closing times.
There is no way that you can trade the market every single hour of the week. However, being that the foreign exchange market is open 24/5 almost everyone can find sufficient time to trade. We need to manage our trading time in such a way that we can give our full attention to the market without any distractions.
You get part time traders, and then you get full-time traders. The big difference between them is that professional traders do it for a living. We part timers do it for some extra spending money or whatever the case may be. Unfortunately, for the part-time traders, the market is not open over the weekend, so the only time they have time to trade is before and after work. This means that they have limited hours to trade while professional traders start trading when they wake up and keep trading until the day is done. So let’s have a look at how you, the part time trader, can manage your time effectively.
This step is the most significant piece of time management. It is important to note that you can only use your free time as your trading time. Trading will demand a lot of focus from you, especially when you are short term trading with Binary Options. Ask yourself the following questions: What time do I start and finish work? What do I do before and after work? How long does it normally take me to do these activities? How much time will I have left for trading? What will my trading times be? These questions will determine which hours will best suit you and your lifestyle.
Remember when choosing your hours – you need to take into consideration what market session will be open. Different market sessions have different effects on currency pairs. Trade the assets that will provide the most opportunities during your trading hours. The overlap between sessions is usually a great time to be trading, so make sure you take it into consideration.
Ok so let’s say for instance you choose to trade from 17:30 – 20:30. You should not let anything interfere with your trading during these hours. Make sure that you finish all your tasks before and after your trading time. Don’t do anything else besides trading during your predetermined timeframe. There are of course exceptions where you will have no choice, but try to stick to your trading hours at all times just as you stick to your work hours. Trading is a profession and not just a hobby, and thus you should treat it as such.
The best way for most people to prepare for trading is doing some sort of exercise. Some like to go for a walk, others do yoga or lift weights just to get the blood flowing and to get their mind in the game. There is no need to exhaust yourself before trading; 5 – 15 minutes of exercise is all you need. Also, don’t be afraid to grab some coffee before you start. It will definitely help you concentrate, trust me!
The bad thing about having limited trading hours is that we can’t focus on a broad range of markets. We can only concentrate on a fraction of it. This is because of the fact that we would most likely just be trading one market session during our trading time. However, there is a positive side to having limited trading hours. We could become specialized in only a few chosen assets that we want to trade. Why on earth would this be an advantage, you might be thinking? Firstly, you will get accustomed to the movements of the pair. Secondly, you will feel connected to the pair and should be able to make better trading decisions. Having lots of trading pairs could actually confuse you if you are a short-term trader. You don’t need a bunch of pairs to make some real money.
This is probably one of the most important steps, but also the most difficult step to adhere to. Most people want to keep on trading after their trading hours have passed because they want to make more profits or want to win back the money they lost. You should STOP trading when you have reached the end of your trading hours. I can’t stress enough the importance of this. If you decide you want to carry on, you might just end up losing all the profits you made for the day or worse, end up further in the red. To combat this, you have to set profit goals and limits to your losses for the day. That is why it is so important to have a Trading Plan and the discipline to follow it. When you reach your profit target, you need to stop trading for the day, even if your trading hours are not over yet. Same goes for your losses. Stop after you reached the max loss for the day that you have set out in your trading plan.
Treat every day as a new day. Do not let yesterday’s losses influence your trading today. Follow your trading plan and stick to it. As difficult as it is to stop trading for the day, it is necessary. Not stopping is a recipe for disaster. When you hear the end bell ring for your trading hours, take a deep breath and relax for few minutes. Release your thoughts of today and start thinking about tomorrow’s trading. Take the time to see if there is any news being released the next day. Draw in any new support and resistance levels that formed; the same goes for supply and demand zones. Search for anything that might give you a trading opportunity tomorrow. Prepare yourself for the following trading day so that when you go and sit in front of the computer, you already have a game plan in mind. This will save you a lot of trouble for the following day.
Efficient Time Management could be the key to your success. It could turn your losers into winners and make you a consistently profitable Binary Options trader. When your time is restricted, the only possibility is to be more efficient towards your trading. Manage your time right and make better decisions.
September 16, 2015 at 8:45 pm
Man oh man have I been doing this trading thing wrong all along… I try to trade in between my work that I do and I just can’t seem to get the whole trading thing right. This article just makes SO MUCH sense. I have never felt connected to the market as you explained. I am most certainly going to try my best to make some time after work to make a few trades.
September 16, 2015 at 11:51 pm
Great tips Alex!
I just wish I actually had time to trade without any distractions. I get up, go to work, work my ass off and come home. This is where my real work happens – I have a newborn son and well, he is a handful. I promise you, just as I think I can sit down and trade, he starts crying. If it’s not him it’s my wife.. Hopefully she doesn’t read this!
Being a parent is no joke. Anyway, I am sure I will have time to trade in peace in a few months’ time – or so I hope.
September 17, 2015 at 8:28 am
Kristopher, I know exactly how you feel mate. I also had the same problem a while back with my daughter, but believe me there is light at the end of the tunnel!
Hang in there, bud 😉
September 17, 2015 at 9:53 am
This is exactly what I need in my trading. Just as I start looking at the market, I have to go do something else. The only way I will be able to trade without any interruptions is to do everything I have to do before I start trading. The only problem is that it will only be 1 or 2 hours.
September 17, 2015 at 12:02 pm
Carylon.. 1 or 2 hours without any interruptions is much better than trading 4 to 5 hours and being bugged the whole time. I started to manage my trading time as prescribed in this article and I started seeing the results immediately. I only trade 2 and a half hours and I make more than what I was making in 5 hours!
Definitely worth it… Luigi
September 17, 2015 at 1:15 pm
Wow that is INSANE Luigi. What market session do you trade though? How many pairs do you watch during that time?
September 17, 2015 at 3:34 pm
Hi there Carylon!
I trade the New York session. My strategy works the best for this time. I have my own business so I made sure that I have time to trade this session. I normally focus on the EUR/USD and the GBP/USD. This gives me more than enough opportunities during my time that I trade.
September 17, 2015 at 4:41 pm
Luigi, thanks for coming back to me! You are lucky to be able to trade the NY session. I, unfortunately can only trade the Tokyo session. I am thinking of just getting up earlier and trade a better session. But I think it will be too difficult because I’m not a morning person haha 🙂
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