The question of what are the best and worst trading times comes up over and over again. If only it was as easy as “only trade from 9:30–11:00 a.m., except on Fridays…”

The reality is, there’s a lot more to it than that. It’s not an exact science. I do have preferred trading times, but it’s a disservice to limit the discussion to specific hours.

So, does the time of day actually matter for trading?

Yes, the time of day matters, but it’s not the be-all and end-all. One thing you must consider is what works best for you. Your personal schedule. Because while there isn’t a one best time of day to trade, there are worse times than others.

But I’m getting ahead of myself.

Take A Step Back To Find the Best Times to Trade

As you go through the testing process, you want to figure out your sweet spot. But to do that, you have to take a step back and review every trade. It takes time — like a few years or more. I’d say for most traders it’s more because anything less and you’re still a newbie.

Think about it, if you take up any serious discipline, it takes years to hone your skills. Ask any professional athlete or musician. They don’t think they have it all figured out in less than a year. Trading is no different. And don’t let any of those fake ‘gurus’ talk you into anything different. Ask them to show you the details of every trade before you buy their snake oil.

What should you look for? If you keep a trading journal — which I recommend — then make the time of day one of the criteria you track. It’s much easier to be objective about it that way. All my top students tested and tracked various setups until they figured out what works for them.

I hear it over and over again when I interview top students…

“I took a look at my stats and realized this was the best setup for me and this other setup was bad.”

Personal Schedule

Why is your personal schedule so important? Because you don’t want to be distracted when you trade. You need to be 100% focused. It’s too easy to make costly mistakes if you’re not focused.

Remember, it’s not an exact science. I can’t say, “You should trade the first 90 minutes after the open and the last hour before the markets close.” That’s ridiculous.

If you’ve gotta walk out the door in 10 minutes, it’s unlikely you want to enter a trade. That’s not to say you couldn’t achieve your goals in 10 minutes. It’s just very risky to expect it to happen.

So if you know that you have something going on that is going to interrupt you in the middle of the time that you typically trade… then don’t trade. It’s that simple. If you can’t give all your focus to trading, and you’re going to be distracted, you’re going to trade poorly.

Sometimes the Best Trade Is No Trade

This brings up one of the most important concepts I’ve been trying to pound into students’ heads for years…

Sometimes the best trade is no trade. Start with that underlying concept before you try to figure out what the best trading times are. Be willing to walk away — completely.

I’ll come back to the best times to trade. But let’s start with…

The Worst Times to Trade

When There Are No Plays

This should be obvious, but I can’t tell you how often I get messages from newbies saying they just want to trade. Today. To “get their feet wet.” Then they lose a lot of money.

The sad thing is, sometimes they don’t learn. They keep getting into trades with no clear reason and no plan. This is the typical degenerate gambler mentality. Don’t get sucked into that trap.

Wait for the plays to come to you.

Revenge Trading

Don’t try to make up for a big loss by taking another trade. I see it over and over again. I’ve even fallen for this myself. It’s not worth it. Most traders do it at some point. The key is to recognize it and learn to avoid it.

If you catch yourself trading the same stock saying “I’m gonna at least get back to zero on this one,” that’s a bad sign. Or, “That trade screwed up my weekly profit/loss… I need a winning trade to get back up…” That’s also a bad sign.

Chasing Action

If you feel like you need some action … that’s a terrible time to trade. That’s also degenerate gambler mentality. Walk away. Start to think like a retired trader. Only come out of retirement when the setup is so good you’d be stupid not to trade it.

That’s not to say you’re gonna win just because the setup is right. I WISH it was that easy.

When You Have Other Commitments

This is related to your personal schedule.

Look, I think you should be the best you can be at everything you do. Whether it’s trading, your relationships, hobbies … whatever. Be the best you can be.

It’s nearly impossible to be a great trader if you’re focused on something else. Likewise, it’s nearly impossible to focus on a conversation if you’re in the middle of a trade.

Swing traders do things a little different. Still, I wonder how many of them can detach when they have a large open position? I find it very difficult. If you can, more power to you. But as for me and my trades, I want to be laser focused.

Illness

I sometimes trade when I’m feeling ill. But my stats show that I don’t trade as well. If you’re sick, why not rest? It’s OK to have a sick day as a trader. It’s much better than taking a big loss because you think you need to trade.

Dudes on Ludes Shouldn’t Trade

There’s a twisted undercurrent of coke heads and other drug abusers in the trading world. From Wall Street to the offshore pumpers, it’s there. I’m not saying everyone does it. But I do want to warn you against it. I assure you it doesn’t give you an edge.

Heck, I can barely take over-the-counter cold medication without feeling weird. So I try to avoid it.

Hungover

Look, I’m not saying I haven’t done this. I’m human and trading isn’t like the Olympics. So learn from my experience. Trading while hungover is not the best idea. Your brain is cloudy. Your judgment is skewed. Go hydrate, instead. Then avoid overdoing it again in the future when markets are open the next day.

The Bottom Line

Now that I’ve said all that, let me be clear, the key to trading when things aren’t perfect is preparation. I’ve traded from planes, trains, cruise ships, and cars. I was on a train once where the WiFi dropped as we went downhill and only came back again at the top of the next hill.

Trading doesn’t have to be a perfectly controlled environment. But the key is preparation. If you’re prepared it’s possible to overcome obstacles. If not… you could pay a big price.

Alright, those are some of the worst times to trade in terms of your personal schedule.

Come back tomorrow and I’ll tell you the best trading times.

Related Article: Timing Is Everything.