To trade end of day is a dream for anyone wanting to tell their boss to “stick it”. Face it, if you’re anything like me when I first started day trading then it’s highly likely. No shame in that. Who hasn’t?
The shocking truth is that many people who make this bold transition only to spend their new found “career” trading from home, haemorrhaging money through over trading out of boredom, frustration and anger in a vicious circle where they spend more time than ever being slave to the screen than ever was the case with their day job.
But the great news is that do not have to quit your day job to make a success of price action trading, or spend hours on end watching charts move up and down. You can be a “fulltime” trader trading from home, happy and secure with your co-existing with your day job.
In fact, you can also be a very successful, consistently profitable trader trading only minutes a day without lavishing thousands on training, charting software, EAs or extra computer equipment.
You can do this by trading the higher timeframes; the daily and weekly chart, by trading end of day. Trading on these timeframes might be boring and require trading less…but don’t let that deter you! As you will discover the pros far outweigh the cons.
Here’s my 4 Reasons Why You Should Trade End of Day
Every market movement is by triggered by fear and greed so trading this can be and is an emotionally charged experience – not least because you have money in your trading account at stake on every trade you take so it is likely you will have an emotional attachment to the outcome; ie feeling over the moon if the market proved you right and you make money or feeling rejected by “getting it wrong” and losing money.
Whether you’re complexly new, intra-day trading or just getting started, imagine this as a silver lining: transforming what is experienced by 92% of have-a-go traders a loss making exercise into a profitable, relaxing and carefree “hobby”.
The smaller the timeframe you trade the more emotional your trading experience will be trading it (especially if you are watching it!) – the extra volatility, bigger stake size and increased exposure to news will take its toll.
This is possible in a scenario where you have, minimal contact with the charts when the markets are moving and your trades are in progress. Not only will you be less prone to self-sabotage with emotionally fuelled ‘knee-jerk’ decisions which will later make no sense, but you will also be enjoying this hands-off style of trading, trading end of day, which allows your money to work for you without you having to swap your time for it.
End of day trading may mean that you may have fewer opportunities to take advantage of over time, but the trade set-ups which do manifest themselves on the daily tend to have far bigger reward potential that the same set-up would have on a smaller timeframe. Because you have a bigger timeframe, you will be able to take advantage of huge movements at key technical levels enabling you to set your orders up and simply walk away until further notice. Such technical levels seen on the daily and weekly timeframes will be infinitely more solid than what’s seen on the smaller timeframes.
The trade could last days, weeks or in some cases, months…but rest assured your money will be working for you on autopilot in pursuit of a far bigger reward/risk profile without you having to “babysit it”.
Fewer trades with a higher reward potential is no bad thing. After all, it’s far better to take advantage of high quality set-ups rather than trying to jump onto anything that moves like amateurs by fearing that they will miss out if they don’t.
Many trading newbies are attracted to trading after being seduced by the imagery of fast cars, sun kissed beaches and Bollinger for breakfast only to fall into the first set of deadly pitfalls. They are fearful of “missing out” from not being in the market so take it on themselves to sit in front of their charts watching every tick move up and down. Secondly, many amateur traders are also under the deadly illusion that the more time that is time spent sitting and salivating over the charts equals more money and percentage gain. Is this really what you signed up to? Or would you rather use trading as a vehicle to get to where you want to be…there is a big difference!
But what is fact, is the concept of opportunity flow and the frequency of trade set-ups in the market. Put simply, markets are random and chaotic, and for that one reason tradable opportunities are very much like busses; they can all arrive at the same time or you could find yourself enduring a rather long wait.
What is essential for any trader regardless of timeframe is they have to be in this opportunity flow in order to profit from a string of wins. Imagine waiting for the bus to arrive for a good 20 minutes only to give up, walk away and, to your horror; see three turn up at the same time in the distance…but which point you’re too late! It’s very much like that with trading and missing one of your usual trading slots.
Imagine trading your chosen strategy on the 15 minute chart in the London session in the morning and enduring 3 consecutive losses only to go and walk the metaphorical dog, return to your screen an hour later and find that, to your disgust, that your strategy had yielded 3 further opportunities in your absence – all of which went on to hit what would have been your profit target. If a prospect like this leaves a sour taste in your mouth then in may be worth considering how you are going to deal with ‘opportunity flow’.
It’s a risk faced by intra-day traders consistently. But for us end-of-day traders we can be in this flow of opportunity trading the daily chart by only looking through the charts once a day when the daily bar has closed. Not only does this take only minutes but is also the most time efficient way of trading as it means: we have a very fixed view of what trade set-up we are looking for, we never miss a potential opportunity and we don’t have to spend an unnecessary amount of time looking for it! It’s simply win-win-win.
Ever thought that time equals money? In most cases you would be right…but not with trading. Far from it, in fact! With end-of-day trading, less really is more and you can achieve a far better potential gain for the reduced time spent looking for trades. Once you have a good idea of your trading strategy and how to use it, merely minutes every day, compared to intra-day trading where your strategy often requires you to sit patiently for hours every day waiting for that trade set-up. Take Jack and John. They both achieve an 8% gain for the month, yet Jack trades end of day for no more than 30 minutes an evening as an end-of-day trader who is relatively new to it all, and John spends four hours a morning trading as an intra-day trader.
Consider there are on average 22 trading days in the month and Jack has a total of 11 hours spent glued to the screen while John has a total of 88 hours!
Who do you think makes the better return on their money for the time spent in pursuit of profit? Jack, of course! Even if both traders had made a % loss, Jack would still be better off granted he has made the same amount as John but has spent infinitely less time labouring for it.
Either way, while John is zoning out to his moving bars, Jack is playing tennis, catching up with friends and developing other business ideas with his abundance of free time end-of-day trading has always and will continue to give him.
End-of-day trading means you can profit from the flow of opportunity from only minutes a day.
As long as you know your strategy and are prepared to follow its rules mechanically, there is no reason why you cannot do the same and enjoy the benefits of lifestyle trading, and the new found abundance of free time trading the daily chart can give you…so that you can do what you want, how you want, where you want.
People are often perplexed to learn that fulltime traders are “working” for a fraction of the amount of time that intra-day traders do. Unlike you from reading this far, they have yet to discover the time/return benefits.
That’s the reality of end-of-day trading.