Is it possible to make money trading intraday?
We have discussed a similar topic before to some extent in our “A day in the life of a Platinum Trader.” However, this time. Let’s focus on Intraday itself and one of the most important lessons you can learn to trade in that style: Timing the market!
Timing the market
What many traders out there do not understand, even some who already trade for a living is that the fact that you trade intraday does not mean you need to be in front of your screens all day long. Quite the opposite is needed for you to trade intraday. Let’s understand the times you should and should not trade, to begin with.
The London Open – Between 7:30 and 8:30 GMT
Let’s understand the London Open with an example. Imagine that you are a client of a bank and you have given an order to the Asian desk that you wish to sell 500 million EUR/USD at 1.2000 and you have stipulated that if this order has not been executed by the end of the Asian session, you want the order to become an “At Market Order” on the London open. As a result, on the London open there will be an order in the market to sell 500 million EUR/USD at the best price available. now if we imagine that there are 10 of these orders to be completed we can see that on the London open there will be clear selling due to these orders in the market and this can cause a drop in the price of EUR/USD as these orders are executed. Now if we imagine that there are 10 of these orders to be completed we can see that on the London open there will be clear selling due to these orders in the market and this can cause a drop in the price of EUR/USD as these orders are executed. We want you to stay clear of this type of price action because it can fly in the face of where the market is actually trending. We advise Platinum traders to steer clear of this time of day so as not to get caught up in this early morning order flow moves.
The late morning on Euro and Cable – Between 11:30 and 13:00 GMT
This is an old trading style which still works to this day and many traders are not aware of this. Let’s imagine you are a trader and you have placed trades on Cable during the morning, the market is rallying and you are about to go to lunch. What will you do? You will book your profits before going away from your desk. London is responsible for 40% of the transactions in the FX Market. The Euro and Sterling currencies will be traded the most during the London/European session. Now imagine all the traders in the City of London trading in the morning and pushing the prices to a higher level and are about to go to lunch. They will inevitably cut their exposure as they want no surprises when coming back from their lunch break. What do Platinum traders do? If we see a fresh buy or sell zone in our Trading Algorithm at this time, we go for it for an intraday position.
Example of the late morning theory in action
This EUR/USD chart is a great example of the late morning theory in action. As it can be seen on the chart, we have had 6 different days in which the strategy have worked and in 5 of them, you would have had your 20 pips target hit. This is the power of knowing how, when and why to take a trade for quick profit.
The London Close – Between 16:00 and 17:00
The London close again is another time where orders can build up for execution as per the example of the London Open. We don’t want to be trading at this time as there can be exaggerated moves in the market that we want to avoid.
The end of day daily range – Between 20:30 and 21:30 GMT
Another time of the day that many traders are not aware is the late evening time between 20:30 and 21:30 GMT. If you imagine the world as a circle divided into three parts, we have London at the top, New York and Asia following round. At times during the day, we will have crossovers of markets. Asia into London, London into New York, New York into Asia and Asia back into London again as the cycle starts over on each day. This time of the day is when you will have the market at its lowest in liquidity. For you to trade at this time for quick profits, you must know the average daily movement for the currency pair you are going to trade. For example, EUR/USD has a daily average movement of 95/105 pips. If this currency pair has completed or is close to complete its daily average movement and hits a buy or sell zone on our Trading Algorithm at that time of the day, we just take the trade of the week. It would be almost impossible for this trade to fail given the conditions in which it is taken.
Fridays from 15:00 GMT
This is a time when Platinum Traders will not be in the market at all. As a rule, we just cancel any pending orders every Friday at 15:00 and go for our weekend. A lot of profit taking and end of week order flows happen at this time. Also, let’s not forget that the institutions will be the ones closing the market and the weekly close is very important to them. If you are planning any intraday trades, you should never plan them on a Friday afternoon.
Now that we understand the importance of timing the market as an intraday trader, we can draw a plan and work around these hours to plan our intraday positions.
I completely understand many people will say that Intraday Trading is suicide or that you have to stay all day in front a computer screen to trade that way. Well, actually what I believe is that most of the traders out there do not understand how the market works and what is behind its movements. Once you understand how, when and why prices move in the charts and you learn to strategize your times of the day, you become so confident that you treat the market as your cash machine. You just take profits at will. It works exactly like that.
The Platinum Formula:
Perfect Fundamentals + Perfect Technical Analysis + Perfect Logic + Perfect Risk Management = Perfect Trade
The Platinum Way
At Platinum Trading Academy, United Kingdom, we teach all individuals from different walks of life to become a full-time trader or create a secondary revenue stream by trading part-time. We trade in an Institutional Way by letting the market come to us and being patient. Using Platinum’s Trading system you can take many Pips out of the market. We can ensure using this style of trading your trading will make a turnaround as you will become much more consistent. If you want to trade like the professionals do, making consistently profitable returns from your trading, get in touch with us and we will demonstrate live exactly how we approach the markets. Download our free ebook to read about the various Trading Patterns that work in the Financial Market. Watch Trades of the Week Videos in our video gallery. Subscribe to Platinum’s Forex Newsletter. Hopefully, you have enjoyed today’s article. Thanks for reading! Have a fantastic day! Nisha Patel Live from the Platinum Trading Floor.