New traders don’t always place a lot of emphasis on time when approaching the pre-race markets. But it’s massively important!
Above you can see an image of my Market Overview chart through the Geeks Toy. It’s set it to 5 minutes so the entire chart (right to left) is the last 5 minutes of market activity between runners.
Can you spot anything significant? Anything that might turn a loss into a profit?
If you look at the image you can see clearly at around half way (2 mins 30 seconds) before the image was captured, something happened. Prices started to move more, why? Because market activity increased suddenly.
Also you’ll see from the header bar that only £121,310 has been bet on this race, that tells me a couple of things straight away. Liquidity per-second has increased as of the last couple of minutes, and prices have already started to shift, further still its quite a weak market.
Why’s It Important?
Trading prior to that activity kicking in would have been trading suicide in my opinion. Unless you’d already taken a position hours before or felt pretty certain a price was very wrong!
Short-term trading when the market isn’t very active isn’t the best idea, particularly on enhanced stakes as you need the increased activity to enter and exit positions be it win or loss. Just think about it… It’s a bit like turning up to party before the booze and music and expecting to have fun alone.
Trading early is often a common mistake for those not making it pay just yet. It’s also one of those things that you grow to realise isn’t really cut and dry (in terms of when it happens). To succeed long-term its important to control losses, manage risk and maximise profits. So its important you bend your trading strategy around it.
Bank holiday Monday was being a prime example if you was trading it! With all the races on offer, scheduling is tight, as is TV coverage and liquidity is thinner spread amongst the races. For this reason alone you’d need to be more aware of the times you choose to trade.
Depending the reasons for your trades this may not be so important (longer-term trades, morning trades etc). But even then you’ll need to consider another time-frame, there’s no escaping it! Obviously this also means; some strategies work better in different time-frames. Which is another reason it can be frustrating when you start out, discover an edge, and then think you’re going mad after applying it to completely different time-frames.
I think the points clear: Knowing when your ideal time-frames are, is a pretty big deal.
Time is important, in many different ways. Be sure not to waste it, and if you don’t know what’s effective or not – that’s a waste to me…