› Should I leave it overnight?

Should I leave it overnight?

If you opened a position in the morning and the price was moving in your direction throughout the whole day, is that position worth leaving overnight? What about the weekend? Surely, these questions are related to profitable positions only. Holding a losing position after the market close is the choice of a doomed amateur.

A beginner daytrader must close positions until the end of the trading day while an experienced professional might consider holding them overnight. If the market closed a couple ticks lower than the top price level, then the price would keep growing towards a new top in the next day. If the market closed near the bottom, then the next day would promise a new low usually. But such a price action is not guaranteed. The market might close near the top, and some bad news could affect the overnight change in the traders’ sentiment. So the market will open much lower the next day. Therefore, only experienced professionals can allow themselves to hold their positions overnight.

beginner daytrader
Source: www.daytrading.com

Your trading success depends on analysis, knowledge and discipline. You need to analyse historical data and calculate probabilities in order to have a stronger background before making a decision. Almost every trading session includes hours when the market price does not move anywhere and you have a chance to work with figures during that time. You can use two different gadgets to trade with - one for intraday traders, the other one for the research. Open the market data for the last year, download it into a spreadsheet and start asking questions. How many times did the price reach a new top the next day after the markets closed in the range of five pips from its daily maximum? What was the difference in points between two highs? What about days when the market closed five pips above the daily low level? What was the further decline in the price the next day? ANswering those questions, you will clarify what happened the next day after the market closed in the range of five pips and so on.

Professionals usually trade in the same market year after year while there is a huge fluidity among the newbies. Professionals are getting used to trading in one certain way and the market fluctuations reflect their behaviour. You need to express it in numbers to act in the scope of the facts and probabilities but not to hope on feelings and hopes. You will have to work on your own. It is impossible to buy answers to the questions - you must find them by yourself. You will gain the confidence needed for the profitable trading only after going through that path.

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