Forex runs around the clock 24/7. I'd like to break this cycle into sections marked by the major exchange market opening time.
I'd like to call these market-section,
- Asian Section is marked by Sydney Opening
- Europe Section is marked by London Opening
- American Section is Marked by NY Opening
Price action is volatility during market section in most the case. GBP cross pair often moves 20-40 pips up and down within a minute. That means, if not being careful, tight stop that is within 10-20 pips would often gets shaken off when entry is made during the opening hour.
There are also I'd like to call time-section. Time section is rather random since the market is often extremely slow when these occur. To me these are the section I'd like to stay away because these are the times bank (stop hunt) and your broker (stop hunt, and swapping) will fuck with you.
- GMT 0:00, where the daily candle completes
This is the period of time when the stop hunt takes place in most case. Major bank, and your brokers takes out the stop (for commission) easier when the market liquidation is low.
- Weekend carry over. That mean you carry your position over the weekend
When it comes to the randomness, weekend has the most randomness. Many key meetings held over the weekend, and many resolved issued, pending answers, hearings are often need to be discussed over the weekend. These factors are included within the Monday opening price - the weekly opening GAP. Gap goes from 10 pips to 200 pips depends what happened in the weekend. and this is something you have NO control over. The only control from your end would be NOT to carry your position over the weekend.
When it comes to calculate the risk, all these factors need to be accounted for to reduce the stress level when "WTF?? WHAT JUST HAPPENED??"
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Do you know what Fed responded in terms how the policy would go when oil hit $45 a barrel (previous historical low) back in Jan 2015?
Do you know what are the most feared factors in the current dollar situation?
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