Features of trading within a week
Trading volumes are very important when trading on the Forex market, because they represent the main interest in the market. Trading volumes on the market are changing constantly due to a variety of technical and fundamental factors. But despite this, trading volumes create certain patterns throughout the week, which allows you to make predictions for certain days of the week. Since the features of Monday and Friday trades have already been considered, we will omit them.
This article focuses on trading days Tuesday, Wednesday and Thursday. It should be noted that the divisions for the days of the week for the market have no actual value and this division is just for easier understanding. Because the market not always meet the expectations.
With all relativity, the middle of the week – Tuesday, Wednesday and Thursday corresponds to the maximum trading volumes and indicates the price movement in the weekly trend. These days of the week the market has the highest probability of continuing the trend and the lowest probability of a reversal. But in this case, it is worth making a reservation on significant fundamental factors for which the economic calendar will help you to prepare.
Fig. 1. EUR/USD chart. Preservation of trends during the week
The figure above shows an example of price movement in a steady trend in the middle of the week. The exception was September 26, 2018, when the US Federal Reserve raised rates. It broke the established rule.
It is worth noting that the main volume movement of the market falls on Wednesday, if trading on this day is not limited to fundamental factors. While Tuesday and Thursday can continue or partially adopt the features of Monday and Friday.
Fig. 2. EUR/USD chart
The picture above shows an example of the longest movement, where Monday and Tuesday regain movement against Friday. And on Thursday, movements aimed at a correction against the weekly decline were traced, but they received a clear expression on Friday.
At the same time, the movement within the week can also be very limited due to the saturation of the market or the lack of significant drivers. It makes trading within the market less volatile and unidirectional.
Anton Hanzenko