Most traders who read my blog may not know that over the years I found a rhythm to my trading.  It usually involves trading from January to the end of May and then taking the Summer off until Labor Day when the typical volume came back to the market.

This was especially true when I was trading predominantly trading futures and stocks.  But the world has been changing.  Wars, all time highs and lows in currencies and energies, interest rates and more have taken the summer doldrums and truly changed this season into a valid and increasingly important time of year.

No more summer vacation…

But that being said, a trader does need a break.  So let’s talk about which weeks you should be especially aware of for lower participation. 

By the way lower participation typically means unpredictable moves, lower follow through and poor trends which is exactly why we want to avoid this type of environment!

I now take June off and will also take the two weeks leading into Labor Day off as these seem to be not only good times for me to take a break from the market but also unproductive trading times for me over the course of my trading career.

The doldrums also applies to certain intraday times as well where I will not enter a trade because of lower participation.  Specifically I use the "two time zone rule" which means that I will not enter a trade when there is not at least two major financial centers open.  The major centers I watch are Sydney, Tokyo, Hong Kong and Singapore, Frankfurt, London, and New York City.  Again I will not enter a trade unless at least two centers are open.  Trade management (stop losses, profit target) can be executed at any time of day.

Always ask yourself "who’s awake?" and "who’s on holiday?"  A simple glance at the clock and the economic calendar will take care of this.