Because of the coming holidays, you are probably wondering should you trade in December at all and if yes, when should you stop and resume your trading.
In this article, I will share with you how I trade in December.
First, let me briefly explain to you how holidays, especially Christmas and New Year, affect the financial markets.
In many countries, Christmas and New Year's Day are official banking holidays.
In Europe, for example, December 24th, 25th, 26th and 31st are official banking holidays.
In the UK, the markets are officially closed December 25th and 26th.
While December 25t is the official banking holiday in the US.
When I trade I stick to the following rule: when there is a banking holiday in US, UK or EU I don't place any trade in that exact day.
However, with winter holidays it is a bit different.
I always skip the entire Christmas week - from 25th to 30th of December, because even though many markets remain opened, they are hardly moving and very slow.
You should also be very careful, trading the third week of December.
Till Wednesday, I trade in a normal schedule.
The presence of various important fundamentals in the economic calendar (especially the US ones), indicates potential volatility and nice movements on the markets.
With many years of experience, I noticed that trading volumes start falling since Thursday. And on Friday in many countries there are early bank closes or banking holidays like in New Zealand.
So my advice is, close all your trades on Wednesday 20th in the middle of NY session and stop trading.
📝 Here is the plan: we trade in a normal schedule the first half of December and then all the trades are closed, and we are enjoying holidays.
And when should you resume trading?
Again, here is a constant debate among traders. My take is to resume trading from the third week of January.
