New To Trading

Weekend trading

Trading on the stock exchange used to be limited to during the week business hours, partially due to the desire of traders to close shop and enjoy their weekend to the fullest. But times have changed, there is no central market, nor even only one form of currency. Developments in technology have made the trade markets in any country in the world accessible from your cellphone or any other mobile device. Currency rates, bitcoin, and cryptos can all be traded over the weekend, others are limited to strict market hours.

Here we will go over some of the advantages of weekend trading and some of the risks you may come across, which are the best markets to focus on and strategies to use.

In This Article:

  • Educate yourself

    • Manual backtesting

    • Evaluate

    • Plan ahead

  • Final thoughts

How To Start Weekend Trading Online In 3 Easy Steps

1. Select Broker

You’ll want to choose a broker that gives you access to shares listed on the London Stock Exchange.

2. Deposit Funds

Deposit funds in a matter of seconds. Choose from a debit/credit card, e-wallet, or bank wire.

3. Start Weekend Trading

Search for stocks, specify the number of shares you want to purchase, and click ‘buy’.

Top Brokers For Weekend Trading

eToro

Highlights   An ideal trading platform for both beginners and experienced traders! With over 8 million users eToro is one of the largest social trading platforms in the world. 
Licenses   CySEC, FCA, ASIC
Min Deposit:$200

Plus500

Highlights   Plus500 is a globally-regulated broker offering to trade on more than 2,500+ leveraged CFD instruments commission-free covering Forex, Commodities, Indices, Shares, Options and Cryptocurrencies.
Licenses  ASIC, CySEC, FCA, FSB, ISA, MAS
Min Deposit:$100

BDSwiss

Highlights  BDSwiss is a Forex and CFD broker offering to trade on 250+ instruments covering Forex, Commodities, Cryptocurrencies, Indices and Equities, from 3 account types on the MetaTrader 4 and MetaTrader 5 platform.
Licenses  CySEC, FSC
Min Deposit:$100

Is it possible to trade on the weekend?

Absolutely, although limited. India, Nasdaq, and the USA trading sights are closed over the weekend closing at 4.30 pm on Friday afternoon and re-opening on Monday morning at 9.30. But thanks to technology the doors are open to many more options. Every country has its own rules and its own timetable. You can even start to trade on the international market from Sunday evening thanks to time differences. The middle-east, for example, start trading on Sunday and close shop on Thursday due to their weekend days being Friday and Saturday. Here are some of the most popular indexes for weekend trading:

  1. DFM Index – The United Emirates has various stock exchanges, this is one of the most important based in Dubai. 
  2. Kuwait Stock Exchange – Kuwait’s national stock exchange is limitless
  3. Tadawul Index – Saudi Arabia’s only stock exchange.
  4. Tel Aviv 25 Index – Tel Aviv, Israel’s top 25 most important companies.

But times are changing some stock markets are starting to offer weekend trading. As more open it is important to familiarize yourself with their different operating procedures. Wall Street, Dax, and FTSE to name a few.  Most however are closed for the weekend so this can be used as a time to analyze the market from a swing or position trading vantage point and to plan strategically for the upcoming week. Those trades that you do make during weekend hours can be left open until the official opening hours of the market you are trading. Be careful, this will affect the outcome. 

Reasons to trade on the weekend

Trading in peace– during the week life is full of distractions, work, and family commitments. For many the weekend is a perfect time to take a step back and analyze the markets and trade where they can. More focused means better decision making and hopefully better yield. With the freedom to choose what times over the weekend you can be available.

More options for making money– for those that have the time, weekend trading could be in addition to the week. The more you know the market, the more time you put in, the more you analyze principle informed choices, the more money, in principal. See also 

Different markets different peak times– although most markets produce higher profits during the week some are better on the weekend. Not all markets behave the same, the Asian market acts differently over the weekend for example. It is important to have the right strategy in place for the right time. See Forex Trading For A Living

Risks to trading on the weekend

Disadvantages to be aware of for weekend trading. Although times are changing there are still many problems that you will face weekend trading, below are some of them explained.

Limited resources– if you rely on the news for your trading then on the weekends you may be stumped. Those companies that trade on the stock market are out of bounds over the weekend, however, if you like to trade on price movements based on technical analysis then you will be able to pull in some profits.

Risky business– The market is unstable because the regular traders are not active, which means there can be an opportunity for great profits but also for great losses. Where there is too big a difference between the bid and asking prices for stocks the market becomes volatile.

Time zones-can be a blessing and a curse, thanks to different time zones when one market closes and another opens, however, to retain a healthy sleep pattern is difficult when you need to stay up for a market opening on the other side of the world.

Opening hours– because weekend trading hasn’t completely lifted off yet there are still many brokers that close their doors on the weekends.

How do the weekends affect your strategy?

The weekend market is nowhere near as stable as during the week. It is important to understand the unique way in which the market behaves over the weekend. The volume varies, volatility increases as big market traders can be big spenders over the weekend. It would be useful to have an alternative strategy to deal with these variations.

Here are some helpful strategies to help you with weekend trading.

Closing Gaps

This strategy is best to use with currencies or commodities. Something simply accelerated the market to cause a price to jump either higher or lower, excluding any prices in between. Making the conditions perfect for trading gaps and open strategies on Forex. Gaps can occur due to new movements or accelerated movements, but they require a lot of people trading on them to produce the necessary volume, but the majority of traders are enjoying their weekends with their families, without them closing gaps are created.

So how do gaps close? Only a few people are needed to close the gap, which is why it occurs mostly over the weekend. Say you have a few traders who coincidentally trade in the same direction causing a spike, others may assume it is a mistake and invest in the other direction.

When there is an upward gap assets will be sold causing the market to fall, closing the gap, and when there is a downward gap the opposite occurs, traders will look to buy and the rise will cause the gap to close.

There is a much smaller volume of traders over the weekend which means that the likelihood is that of you come across gaps they are most likely to close. It is prime time to trade using this strategy by trading with a binary option and to receive a high payout.

 The expiry is predictable, it is most likely going to reach its price target in the upcoming period. It is important not to buy outside that period. You also know the price target, the price will move up or down depending on its direction and meet the price tag of the closest candlestick. Knowing this you can trade high or low or even with the one-touch option. It is the perfect weekend trading strategy, just bear in mind the weekend trading charts and time differences. 

Bollinger bands

Another effective strategy to add to your weekend ammunition and to create the perfect foundation are Bollinger bands. Quite simply they highlight a rather accurate price channel that shouldn’t be left. 

Bollinger bands consist of three lines the upper middle and lower lines. The upper line marks the moving average and then double the standard deviation functioning as a resistance. The middle consists of a twenty period moving average depending on whether the market trading is above or below it it’s purpose can act as a support or resistance. Whereas the lower line functions completely as a support as it is the moving average minus double the standard division.

In general, the market will change direction as it approaches a Bollinger band. If you are going to use this strategy the weekend can produce the best results. There are no large news events or big-time players trading causing the trading ranges to be greater. The Bollinger bands shift alongside the standard variation shifts. Whereas larger movements will stretch those boundaries out along with the trends, making all predictions fail. The only downside is that due to the lack of traders over the weekend the market is more stable making it harder to find these large deviations.

How to use Bollinger bands:

    Follow three simple steps to succeed using the Bollinger band strategy as a beginner or expert

Create a chart- using your Bollinger bands set up your price chart depending on your instrument.

Patience is a virtue– you must wait patiently and watch the market get close enough to one of your Bollinger bands

Predict– Based on what you already know enter your position whether it be either high or low predicting that the market will not cross the Bollinger band.

Other options

As we talked about before many seasoned traders use the weekend as a time to analyze the market and plan their strategies for the upcoming week.

Below are some useful options to investigate during the stock market downtime over the weekend.

Educate yourself

There is no better way to succeed as a trader than to take in as much information as possible as Paul Tudor Jones aptly highlighted; “The secret to being successful from a trading perspective is to have an indefatigable and an undying and unquenchable thirst for information and knowledge.” See Why Education Is Important in Day Trading

There is an endless amount of useful information at your fingertips written and created by the most experienced traders. You can learn something new from everyone and one helpful pointer can lead you on your way to being a successful trader. Try listening to podcasts, specifically designed for the niche you are interested in or read a book or an ebook packed with information you can find some great one on the books page. Alternatively, you can consider Social Trading Best Social Trading Platforms And Brokers 2020

Manual backtesting

Although what happens in the past stays in the past, when it comes to market patterns the past can be a very useful indicator as to what is going to happen in the future and how those markets are going to behave. It is time well spent, running simulators and brushing up your plan before the markets open on  Monday morning.

Evaluate

If you are not interested in share trading over the weekend or trying your hand at one of the above options, use this time wisely. Go over past mistakes, look at the patterns you have come across, the asses with peace and quiet before the excitement begins again. Use this time to go over your management strategy, or your plan for tje week and come up with any areas that you can improve. 

Plan ahead

 As they say “By failing to prepare, you are preparing to fail.” Think ahead, check out the DailyFX Economica Calander and highlight any important events in the economic world that could affect the market and change your plan accordingly.

Final thoughts

Although weekend trading could be appealing to a fulltime worker with no extra time during the week it is important to consider everything. If you are prepared and know the best strategies to use over the weekend it can be used as another great opportunity to earn profits. Although the big-time players are off the scene, the middle east keeps trading. Bitcoin and other cryptocurrencies can be traded at any time. Alternatively use this time to reflect, prepare, educate, and strategize for the upcoming week.

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Michelle D. Madsen

Michelle D. Madsen graduated from the University of Westminster and has been deeply involved in the world of finance ever since. She has worked as a Broadcast Journalist hosting various news shows and informative webcasts about the financial markets. Since 2004 she has also been writing for Metanews daily, her attention to detail, and her in-depth knowledge of the financial markets have led her to cover Foreign Exchange and commodities. The world of finance has changed in the last few years with the introduction and rising popularity of cryptocurrencies. She has in no means been left behind, adding this to her bank of intellect and is now also an expert in cryptocurrencies. For the last ten years, Ms. Madsen has been engaged in the financial market. She has notedly written a great number of incredibly informative reviews for the crypto exchange and forex brokers. Her wealth of knowledge has enabled her to become a leading expert in the field. She continues to inform the public writing up-to-date, thorough reviews for the readers of Metanews as she has for the last decade.
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