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When is the Best Time to Trade?

Market Measures

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With 23-hour trading sessions, what times during the day do different products see the greatest liquidity and most price action? Tune in to see Tom and Tony discuss the best times to trade!

Here at tastytrade, we are always looking to trade the most liquid products. This is because actively traded markets have tighter bid-ask spreads (transparent pricing) and allow quick opening/closing of positions. Greater trade opportunity may arise when the most volume is being traded.

When looking at average daily volume in 2017, we see that S&P futures (/ES) declined roughly 23 percent compared to 2016 ADV. Gold, Crude, Japanese Yen and Euro Fx all increased in average daily volume this year compared to last.

Futures markets trade 23 hours a day, but over 89% of the volume in the /ES futures happens during the American session. Different markets trade actively at different times. Euro Fx follows London sessions and the Japanese Yen follows the Tokyo hours. Crude Oil ends trading early and spikes around 1PM, which was the former pit close. Gold tends to have relatively good volume throughout the overnight session, but volume does spike during US market hours.

Be sure to watch Tom and Tony discuss when the best time to trade is!

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