The foreign exchange Sydney trading market is closed over the weekend, but this does not mean that you should not continue to work. It is possible to continue analysis of the foreign exchange market over the weekend. This should be done for a number of reasons and the three most important are:
- Obtaining a picture of the week ahead
- Outlining the trades you could make in the coming week, and
- Working on a suitable routine to boost your trading plan
Preparations for the Next Week
It is important when you trade that you take the time to plan ahead. It is only through this planning that you are able to focus on the day trading. Over the weekend it is best to identify the major economic events that could affect the market and the currency pairs you are trading. You should also look at any expert analysis to pinpoint where the market could be heading. These pointers help you identify the times to trade and what to trade in the coming week.
Understanding what Drives the Foreign Exchange Sydney Market
When you complete weekend analysis for the foreign exchange Sydney market, you will not have any real time data to work with. This means that all the drivers you are looking at are either fundamental in nature or historical technical analysis. You need to understand what these drivers can tell you about the week ahead and how you can slot this into your trading plan. Once you have an understanding of this you will find weekend analysis very helpful in your trading.
When you use technical analysis during the week you only look at the more recent data. However, over the weekend you need to look at all the historical data. You should look for patterns in the charts which may indicate what is going to happen. Using leading indicators is best during this time. You should keep in mind that this data may change when the market re-opens. This analysis should not give you entry and exit points for trades, but rather an idea of what is could happen.
The news is one of the factors that can affect the forex market. You should see what news is released over the weekend and how that could affect the market when it opens. A lot of traders and large institutes place trades as soon as the market opens to take advantage of news events which occurred while the market was closed. You should not actually do this because you have no way of knowing which way this will turn the market. Simply having an idea about where the market could go is good.
Set Up a Trading Plan
The most important part of weekend analysis is setting up your trading plan for the coming week. If you have a few strategies that you use for trading you can decide which one will suit the coming market. You can also plan when you are going to trade. If you think the week is going to be good for trading the US dollar, you should plan to trade during the New York session and not the London session.