Not surprisingly, few people are able to trade the Forex market full time. Traders who trade from work, at lunch or in the evening will notice that thanks to the Forex market’s volatility, trading sporadically throughout a small and inconsistent period of the day results in many missed opportunities. And it’s these missed opportunities that can take a toll on your trading account and your psychology.
Moving beyond these missed opportunities, there are trading strategies that can work based on only being able to dedicate a part-time effort. Those who a restricted to trading during the evening should limit themselves to certain currencies based on the trading volume during the overnight period. Depending on you location, these pairs could vary quite significantly.
Needless to say, the main issue with part-time trading is the time constraint. Luckily, there are a couple of strategies for those with an inconsistent schedule.
Before you get started, you’ve got to know your Forex Market hours.
|New York||8am-5pm EST|
|Tokyo||7pm – 4am EST|
|Sydney||5pm – 2am EST|
|London||3am – 12 noon EST|
Stop Loss orders
The most important thing about trading part-time is ensuring you’re protected should the market move against you. That means implementing stop-loss orders.
- Take fewer positions and hold mid-term.
It’s important to understand what drives the currency pairs you trade which requires you to take the time to really understand your market. When you can understand the drivers of your chosen currency pairs, be more selective with your positions. Be prudent and prepared to hold them for a longer period of time as long as your stop loss isn’t violated.
- Long term trend trades
Instead of focussing on the 1 hour or even 4 hour chart, take a look at the daily/weekly charts to establish your trends and positions. That way you only need to check out the charts once a day.
- Pending orders
Placing limit, stop, or other entry orders can ensure that you don’t miss out on trading opportunities. Best of all, most trading platforms allow all these orders and more at no extra cost.
- Go Auto
Set up alerts or an automatic trading robot that trades price movements while you’re off screen.
The Forex market is preferable for most part-timers because it runs 24/5, thus providing ample opportunities to profit at any point in the day or night.
Source: Vantage FX Blog