For traders who do FX trading, Fridays straddle the weekend, so we will explain the characteristics and precautions. It is said that many people lose big on Fridays, but why is that? I will explain why so many people lose only on Fridays.
Many people lose big on Fridays
Many people have suffered big losses every Friday and lost all their profits for the week. What actually happens on Fridays? Basically, the first week of the month is when the US employment statistics are released, and the exchange rate becomes highly liquid and turbulent. It is important to look at the list by day of the week and time of day, and quickly obtain and analyze the information. The fluctuations are intense, so you need to check it every time. As a general rule, it is recommended to refrain from investing in large numbers as it is risky. Prices fluctuate drastically on holidays, and some customers don’t even log in.
tend to create trends
Trends tend to form on Fridays, and they often move in one direction. Since Monday to Thursday were all in the range, there are many people who become completely accustomed to the flow and lose a lot when the trend starts. The exchange rate is closed on Saturdays, so it is said that the exchange rate moves that much. Investors are required to make efforts to obtain news and other information promptly to prevent losses. Also, the timing of the New York market is often rough as new orders increase every day.
many economic indicators
One of the reasons why trends tend to emerge on Fridays is economic indicators. In particular, the unemployment rate in the United States is announced on Friday European time. This causes market volatility, especially in the US dollar, and many people suffer huge losses. To protect your assets, you need to judge the situation. Always check the detailed trends of the market. First, gather information from around the world to make a profit. In Japan, fluctuations that exceed expectations occur at 10 p.m. Some people lose their important personal funds due to the increase in national policy interest rates and market participants. When you start, consider the indicators as well.
try to recover the loss
Friday is the last day of the week when you can trade FX. At this time, people who are in the red this week tend to increase the lot size in an attempt to make up for it by ordering everything at once on Friday. As a result, your win rate will be lower than usual and the probability of a big loss will increase. Liquidity may suddenly increase on weekdays, so you need to keep a close eye on the trading tools provided. Avoid automated trading. The market may become congested and its functionality may decrease. As per the calendar, wait until the beginning of the week to do technical analysis of foreign exchange and commodities.
Trades that avoid crossing the week
After Friday, the market is closed and you cannot trade until Monday. The window may open during this time. There are many traders who lose a lot of money because of this, but there are cases where the deficit increases as a result of starting strange trades in order to close out the position as quickly as possible and make the position as positive as possible. Weekly travel is not recommended. If you want to carry over, you need to check it in the system. Also, as an exception, there are days when the service will be unavailable at the end of the year due to Christmas in each country, so please be careful as the service may be irregular.
Mental cause
In many cases, all of the above patterns are directly related to mental problems. Mentality affects trading more than you think. Emotions are what go on in your mind, and they cause you to act regardless of the chart situation. This results in huge losses. If you feel that you will definitely lose on Friday, you have the option of not doing it in the first place. If you do different things 24 hours a day, you will not be so concerned about the market. The basics are important, such as statements by important people, movements in the Tokyo and New York markets, and exchange rates, but mentality also has an impact.
Avoid crossing the week
Once Friday ends, positions cannot be increased or closed until Monday. It’s common for a big event to happen on a Saturday or Sunday, and then a big window opens on Monday. If you are worried, it is important to finish as early as possible on Friday. The most important thing in trading is not winning. The most important thing is not to lose. Also, be aware that trading hours may change depending on summer and winter time. Let’s ask the management of the FX company every month.
Unable to read the flow
On Fridays, it is often difficult to read the flow. There are times when there is no wind until indicators such as US interest rates and employment statistics, and even if you can see where the support is with indicators, it is often blown away by fundamental factors. There are no guarantees in the foreign exchange market. After the London and New York markets, there are many situations where major currencies move unexpectedly, even looking at the data, forcing you to cut your losses when buying and selling. If you don’t have the knowledge, you can also choose not to hold until the early morning when the market is closed.
If you don’t know, don’t do it
It is important not to do it if you don’t know. Even if you have a small amount of money, if you have an event coming up later and you don’t know how it will move, it’s better to stop. Even if the leverage is high, you will lose if the method doesn’t work. The euro and dollar may be quiet during Tokyo time, but when it becomes US time, they will suddenly go wild. Don’t carry over your money. It may fall more than you expected.
XM is recommended
XM was originally known as a FX company with too wide spreads. But this was only recently. Now, an account type called KIWAMI account has appeared. The spread is very narrow, making it very suitable for trading. Therefore, this account type is highly recommended. It is especially recommended for those who trade in pounds, as the spread is extremely narrow. It is a company that ranks high in the popularity rankings among foreign FX companies. It is a FX company with a very good environment because professionals participate.
| KIWAMI | Standard | Zero | |
| USDJPY | 0.7pips | 1.6pips | 1.1pips |
| EURUSD | 0.7pips | 1.7pips | 1.1pips |
| GBPUSD | 0.7pips | 2.1pips | 1.2pips |
| AUDUSD | 0.9pips | 1.8pips | 1.4pips |
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