Huge Moves During Christmas/New Year?

Hi,

The majority of people even so called pro advanced traders tell you not to trade during the holiday period about 2 weeks so many courses advise you to take time off yet we have had unbelievable moves, which IMO challenges the belief that banks and institutions make huge moves rather than fundamentals or technical s. It becoming more apparent to me that the market waits for no one it moves when it wants to look at the Asian session nowadays we are having huge moves on the Euro just now. I think swing trading over 3-4 days is the way to go for the time being imo.

Anyone else have a similar belief?

spreads are larger as volume thins... also it's good to take a break and refresh yourself rather then be some sort of addict that just needs a quotes fix.

If you are a big trader better don't trade as price could go against you so much. I believe thats why successful traders don't trade during this period as volume is thin. Nobody wants to buy their 1000s' lot. But for most of us(me) small little fish finding nemo hehe..we can just trade without having to worry about volumes. Well sharks can't swim in a small aquarium but small fish can

You're right that it waits for no one, but think of it this way:

1. Liquidity has thinned out, so people who would put in larger orders won't trade since managing the larger position is hard (or potentially painful.)

2. Less liquid means it takes less capital to push the market around. In other words, people with bigger pockets than you who usually don't impact the market much might be in a position to impact it, and that means a greater amount of price noise to deal with.

3. Business decision makers on the corporate level are all on holidays, that's not only in the finance world, but in the international and multinational companies that deal with currency risk. The deepest of pockets are on hold.

Does this mean you can't trade? Clearly you can, nothing is stopping you from doing so.. but the conditions simply aren't the best and the noise in price movements becomes harder to decipher (wider ranges of chop.) Not to mention the cost of trading usually goes up a bit as the spreads get slightly wider.

The way I figure it is, my strategies don't work so well around the holidays, so why try to force it? Sure there's still a good chance to make profit, but if my edge is lost when trading conditions worsen over the holidays then why put my capital at risk? Especially if a fund of a few million can have their way with some pairs given the lower liquidity.. it can get quite nasty if you're on the wrong side of things.

I prefer to think of November/December as "How much would I like to lose this month?".

Since the answer is nothing, I don't trade for 2 months out of the year. Historically my best trading months are the first half of the year, with November/December the biggest losses of the year.

Why spend my time trying to get a forex fix like a junkie, when I can just completely cut out the losses of the year by not even trading in it?