| Day traders are a special breed of animals from | | | | 60-minutes usually see the volume decreasing. |
| the investors and swing or position traders. To | | | | This time slot also determines the direction of the |
| them, there is a routine throughout the day they | | | | market for the dayâ''either continuing the |
| notice and take advantage of them. Each | | | | direction set by the first 60 minutes or reversing |
| segment of the trading hours has special meaning. | | | | the direction. The last hour also give clues to the |
| When it comes trading, these traders know when | | | | following day. But due to news interrupting |
| they are at their best and when they will not | | | | overnight momentum, it's more difficult to use it |
| make a dime. | | | | as an indicator. |
| Floor traders are the best at knowing the routine | | | | 4. Day of the week - Depending on the day of |
| of the market. The same human nature shows | | | | the week where swing traders may initiate their |
| up in the everyday life. Humans love routine, even | | | | positions at the beginning of the week and exit at |
| the people who are never do the same things | | | | the end of the week. For others, watching the |
| twice or abhor normalcy and ordinary, they do | | | | beginning of the week to see the tone of the |
| have their own routine in another aspect of their | | | | markets that may play out the rest of the week. |
| life. So even in trading, the stocks and exchanges | | | | In doing so, the day traders may observe and |
| show their similarities day after day, even in a | | | | trade according the week. Mondays tends to be |
| chaotic world in financial markets, there are | | | | low in volume as the weekend slowly fades |
| subtleties that help these traders profit from the | | | | bringing traders back to their work. Wednesdays |
| markets. | | | | tend to find the tone for the rest of the week |
| Here are some of the known facts about | | | | with a trending day. Fridays tend to reverse on |
| markets in general: | | | | the entire week's direction. Many swing and day |
| 1. Volume - Most of the participation are around | | | | traders will usually exit their positions, taking |
| the opening and the closing hours of the day's | | | | profits made from the week's gains. |
| session, especially on days where there are | | | | 5. Month - The beginning and end of the month |
| economic or company news pending. The more | | | | provides more volatility than in between. Why? |
| important the economic news, the more the | | | | Accounting purposes, perhaps, where institutions |
| volume, such as Federal Reserve meetings. | | | | maneuver their assets. There is tendency for |
| Volume and volatility increases exponentially. | | | | volume to appear greater at the first few days |
| 2. Price - There are certain prices where traders | | | | of the month as well as the last few days of the |
| will participate in large numbers such as new highs | | | | month with more conviction in the direction. |
| or new lows. These areas come to be support or | | | | September and October lately have become the |
| resistance, driving more traders into the fray. | | | | turning point of the markets, changing directions, |
| When these prices are near, expect this action to | | | | especially from downtrend to uptrend. The |
| become routine. | | | | crashes in recent history have taken place in |
| 3. Time - Different times of the trading hours | | | | these two months and tend to be the lows of |
| bring different types of volatility and traders. | | | | the year. |
| Opening and closings see many day traders | | | | 6. Season - In general, the summer provides the |
| entering and exiting the markets while half way in | | | | least liquidity due to people in general going on |
| the session will see less day traders as lunch time | | | | vacation. During the rest of the year, there |
| brings quiet time. The day is usually divided into 60 | | | | healthy volume sustains the trend. During the fall |
| minute increments (hence the popular use of the | | | | just up until Christmas will see a rise in volume |
| 60-minute charts by day and swing traders). | | | | and bullish trends. |
| These time slots mark an important routine of | | | | These are routines that should not be taken |
| the day. For example, the first 60 minutes show | | | | lightly. They do exist and finding them can be a |
| high volume with many emotional buying and | | | | long arduous process. Once found, the trader will |
| selling to due market imbalance caused by news | | | | have an edge in profiting from the inefficiency of |
| before the market opening. The second | | | | the markets. |