Tactical trade timing

Understanding the right time to enter your market

When day trading, I take positions only at a time I can expect the market to make a strong move. Knowing when this is most likely to happen helps me to:

• Enter trades that have more potential to hit my profit target.

• Avoid trades that lack momentum.

• Set a fixed, daily trading schedule (with less screen time.)

What time should you day trade?

I use these guidelines to capitalize on the daily expansion:

European Session: 6AM to 10AM (GMT)

GBP & EUR pairs, and European indices are most active at this time of the day.

New York Session: 12PM to 4PM (GMT)

The major pairs, and US indices are most active at this time of the day.

Asian Session: 12AM to 4AM (GMT)

Most active at this time of the day are AUD, NZD, JPY pairs; CAD pairs that are not coupled with USD; and Asian & Australasian indices.

Chart examples: European session

The following charts give you an overview of how this works with my approach.

In short, I look for valid entries in my go-to European session markets, like GBP/JPY or DAX. If my entry trigger lands outside of my fixed time window (6AM to 10AM), there’s no trade.

GBP/JPY

Often around this time we’ll see price form the day’s high/low before expanding. That’s why I like this approach: Trade entries here are a great opportunity to get in close to the source of the move (and capture a solid portion of the daily range.)

Price activity from 6AM to 10AM highlighted on a 15-minute chart for illustrative purposes.

DAX (Germany 40)

Similarly, around this time, price forms the day’s high/low before making a significant move in one direction.

Price activity from 6AM to 10AM highlighted on a 15-minute chart for illustrative purposes.

Know what you want to see, where you want to see it, when you want to see it

These time windows give you a good understanding of when you should be prepared to enter your market of choice.

Combined with knowing what to look for in the charts, this can improve your trading results and streamline your approach.
Put it to the (back)test, and see if this tweak to your timing helps.

Tip: Make your visual back-testing easier with the free MT4 market sessions indicator, used to highlight specific session times on charts. Apply it with the recommended time settings mentioned earlier.