Education · Stage 1 · 05
Sessions and trading hours
The market is open for about twenty-three hours a day, and for most of them almost nothing is happening. Knowing which hours are which is the difference between reading a chart and reading the wrong part of one.
Mak · 3 min read · Stage 1, article 5 of 13
The week, in one sentence
Trading opens on Sunday evening and runs continuously until
Friday afternoon, pausing for one hour every day. Everything is quoted in
the exchange's time zone — New York, written ET — and this article
uses it throughout.
The daily pause is short and it matters more than its length suggests: it is where the session boundary sits, where the daily candle ends and the next one starts, and where every «previous day» level is decided.
The four windows
Nothing on the exchange marks these. They are the working divisions traders use, and they exist because the people awake in each of them are different people.
RTH, and why it has its own name
RTH stands for regular trading hours: 09:30 to 16:00 ET, the window in which the underlying shares themselves are trading. Everything outside it is often lumped together as ETH, extended hours, or simply «the overnight».
The distinction is not bureaucratic. During RTH the index and the future are being driven by the same activity, volume is real, and the book is deep. Overnight, the shares are shut: the future is trading on expectations, in a thinner book, with less on the other side of every order.
This is why so many tools offer a «session» setting. A statistic measured across all twenty-three hours and the same statistic measured across RTH only are two different numbers, and mixing them silently is a real source of confusion.
Two platforms, two different «overnight highs»
Here is the part that catches people out, and it costs nothing to avoid.
Session-based references — the overnight high and low, the previous day's range, the first hour's range — are defined by where you put the boundary. Change the boundary by thirty minutes and the level changes with it.
So when your chart and someone else's disagree about a level, the usual explanation is not that one of you is wrong. It is that your session templates are different. Check the boundary before you check anything else.
Time zones, and the two weeks a year that break
The exchange follows New York's clock, including its daylight saving dates. Europe changes its clocks on different dates, which means that for a couple of weeks each year the market opens one hour earlier or later in local time than it did the week before.
| New York | London | Madrid, Paris, Berlin | |
|---|---|---|---|
| Shares open | 09:30 | 14:30 | 15:30 |
| Shares close | 16:00 | 21:00 | 22:00 |
| Futures pause | 17:00 | 22:00 | 23:00 |
Those are the normal offsets, and they are wrong for a few weeks a year. The fix is not to memorise the exceptions: it is to set your platform to display exchange time and do your thinking in it. Then the clock change is somebody else's problem, and your notes from March still mean what they said in March.
What to take from this
- Open all night does not mean worth trading all night.
- A level's value depends on how many people were present when it formed.
- Before comparing levels with anyone, compare session boundaries.
- Work in exchange time. Convert once, at the end, if you need to.
What actually happens inside the American session — the open, the slow middle, the last hour — is stage 5 of this path, and it deserves its own eight articles.