The LTF says bullish and it did rally bullish today but the LTF still hasnt closed above the prior high all week . Sure would make a nice bear flag with the top of the channel here and all , wouldnt it ?
Range analysis for EU . Between 6 - 8 AM EST theres a consistent lull . Im not concerned with the "why" things are only"when" things are but an explanation for this could be London lunch , only one market open and waiting for the NY open .
I also see a slight twitch in range at the Asian open and do find that a few tradeable opportunities exist . Im only getting involved when theres some action for obvious reasons like liquidity / less slippage / less no fills and a better chance my target gets hit without price going into sleep mode .
Im also a believer that the BIG BIG guys that dictate where price is going do their dirty work when everyone else isnt watching as much , like between times multiple markets are open . I believe they build positions when we least expect it and unwind them when we are all there to absorb their activity without throwing prices off . This explains to me why you see prices go directional in the off hours ONCE IN A WHILE , not every day .
The following 3 users say Thank You to Eric j for this post:
I have had this in mind for a longer time, so I just coded a little indicator that calculates the average hourly range for a specific time of a weekday over a user selectable period. Example: If I select a lookback period of 50 weeks, the 10:00 AM Tuesday bar will show me the average range of all Tuesday morning 10:00 AM bars over the last 50 weeks.
I can apply this little indicator to all instruments, and I will immediately know, when to trade and when not to trade. So let us have a look at the EURUSD.
Below is a chart with the average hourly ranges for each week day for EURUSD. Blue bars show the highest volatility, orange bars acceptable volatility and gray bars lower volatility. These are the findings.
Findings for EURUSD
(1) EUR USD shows the highest volatility on Thursday and Friday during the US session from 8:00 AM to 11:00 AM EST. Volatility drops after 3 to 4 hours into the session and does not pick up after the lunch break.
(2) Volatility on Tuesday and Wednesday is lower compared to Thursday and Friday, it picks up a bit in the late morning.
(3) Monday has the lowest volatility, as possibly the decisions on new currency positions are not being made in the morning.
(4) Notice the Asian box for all days.
Conclusion Trading Times (EST) for EURUSD
Best: Tuesday - Friday 8:00 AM - 12:00 AM (US Session)
Good: Monday 2:00 AM - 4:00 AM, 9:00 AM - 11:00 AM, Tuesday - Friday 2:00 AM - 6:00 AM
Bad: Asian Box, London Lunch Break, US Afternoon Session.
The ranges shown on the chart below are the hourly ranges for the specific weekday over the last 50 weeks. It is not the ranges of the price bars above.
Please register on futures.io to view futures trading content such as post attachment(s), image(s), and screenshot(s).
The following 5 users say Thank You to Fat Tails for this post:
I don't know all of the details but that's one of the thing I gleaned from a Shadowtraders webinar that they teach: most big players position themselves pre-market and close out to the public during RTH
I just have to say thanks, more than just pressing the forum "Thanks" button. You are one of my favorite contributors here at futures.io (formerly BMT) and your posts are always generously insightful, intelligent and well-articulated. It's a pleasure making your acquaintance.
The following user says Thank You to shodson for this post:
pleased to hear this. Happy to return the compliment. Just enjoy being here, actually learning a lot from reading and participating in all the different threads. It is a very valuable experience for myself, so I may pass on the thanks to @BigMike.