Cryptocurrencies are different from other financial markets; they are open 24/7, which means that market changes can be more unpredictable. Sometimes it is a 'calm' fluctuation, and sometimes it is a 'surging' trend. The market is like a donkey; you need to understand its character and habits. You will find it really adorable, but if you try to force it, it will definitely kick back. Whether you are trading on your own or using automated trading, you are essentially trading your own thoughts, and we all face the risk of losses.
Here is a simple summary of the time periods to be grasped (based on Beijing time) to coordinate your assets. The mentioned time points are not absolute, as cryptocurrencies do not have strict opening and closing times like the stock market, so attention needs to be paid before and after these time points.
🌅 Asian early session: Beware of volatility and 'spikes'.
Time: 05:00 - 09:00
Characteristics: Asian and Australian markets gradually open, and market trading begins to become active. At this time, there may be short-term dramatic fluctuations and 'spike' conditions. If the price shows a significant divergence from the overnight European and American markets and the direction is unclear, caution is required.
Strategy: It is recommended to primarily observe and refrain from trading without certainty. If the opening trend forms a continuous signal with the previous trading day's closing trend, attention can be increased.
☀️ Asian midday: The market is quiet, primarily fluctuating.
Time: 10:00 - 15:00
Characteristics: The Asian market enters a lunch break, and the European market is not fully active yet. This is usually one of the quietest trading periods of the day. The market typically shows narrow fluctuations with relatively low trading volume.
Strategy: Suitable for range fluctuation strategies, such as grid trading. However, note that due to small fluctuations, the potential profit space is also limited.
🌇 European session: Pay attention to the impact of economic data.
Time: 15:00 - 21:00
Characteristics: The European market enters the official trading period, increasing liquidity. Market sentiment may be influenced by the release of European economic data. It remains primarily volatile.
Strategy: Pay attention to the economic calendar and watch for the release of important European economic data. The trading strategy can lean towards neutral, focusing on breakout signals.
🌃 U.S. session: The peak and risk of the entire day.
Time: 21:00 - 00:00 (or even later)
Characteristics: This is the most volatile period of the day with the highest trading volume. U.S. investors enter the market, and the opening of U.S. stocks (22:30 Beijing time) will bring a massive influx of capital and emotional impact, making it easy to establish a one-sided trend. Of course, market fluctuations are also the most intense.
Strategy: If you want to participate, be sure to reduce your position size, strictly implement stop-losses, and aim for quick in-and-out trades. This is an opportunity to capture large swings but also the highest-risk 'battlefield'.
Focus on broader macro cycles.
In addition to intraday cycles, also pay attention to:
Weekly effect: For example, weekend market liquidity is low, and prices may be influenced by a small amount of capital.
Major events: Global macro events such as the Federal Reserve's interest rate meeting and the release of U.S. CPI data will completely disrupt the daily fluctuation patterns, causing significant volatility.
This timetable is based on my years of experience in short-term trading and can be saved for personal verification based on trading volume. Personally, I don't like to trade during fluctuations because setting stop-losses is difficult, and profits are thin. If it's a one-sided market, and you observe that it is about to start, it is relatively easy to participate in the trend. However, everyone has a different trading style, so it's necessary to customize a trading strategy that suits oneself.
I will update the daylight saving time version later; anyway, we don't need it now, so there's no rush.
