Market Behavior During the Day

Day schedule of the stock market

(Time zone EDT)

Opening Bell-8:30 am to 9:50 am
(Time zone EDT)

When the opening bell rings, this is the most volatile part of the day.  Some traders take profit from holding overnight and others enter base off overnight and/or pre-market news.  There are traders that use this time to take quick profit due to the volatile and volume is commonly to be high at this time. Myself, I used to trade during this time, but the more I learn about myself, I tend to stay away from this time. 

Morning Reversal 9:50 am to 10:10 am

(Time zone EDT).

The morning reversal usually starts with first leveling out around 9:50 am and towards 10:10 am a reversal has potential.

Low Risk Trading 10:10 am to 10:25 am

(Time zone EDT)

Myself, I tend favor this time over other.  Between 10:10 am to 10:25 am will likely be movement toward the directions with consist volume with less volatility and a proper risk and reward. Many traders will cash out of profitable positions and will be done for the day or trim and trail while others buy dips. This will work it's way up to make or break time. 

Decision Time-10:25 am to 11:15 am

(Time zone EDT)

During this time, there will be waves in the direction due to people trimming and trailing or scalping or a reversal.  I tend to trim and trail at this time to get some profit locked in encase there is a reversal I can break even or continue without emotion knowing I have some profit. Most indicators do not work on day trading from my experience, but the only one I do use is the MACD. This is because many indicators lack in time, but at this time, the indicators that can by used are slow stochastic or RSI. Towards the end of this time, there should be cautious towards 11:15 am because lunch time.

Afternoon Reversal and/or consolidate 11:15 am to 2:15 pm

(Time zone EDT)

This time is where most of the institution traders, market makers, and floor traders will take a lunch. Not all market makers will take a lunch.  Usually junior market makers take over while the senior market makers go to lunch. Volume will dry up which usually causes consolidation or reversals. 

Lunch time is over 2:15 pm to 3:00 pm

(Time zone EDT)

With lunch being over, traders will get back to the market.  Trends are usually established and technical indicators will help traders more during this time. 

Nearing the Closing 3:00 pm to 3:30 pm

(Time zone EDT)

The Bond market closes and bond traders tend to flood the equities market around 3:00 pm to 3:15 pm. There can be sharp moves in either direction.  At this time, use caution due to market about to close and portfolios are going be re-balanced 30 minutes before the close. 

Closing Bell 3:30 pm to 4:00 pm 

(Time zone EDT)

I personally do not trade at this time unless I know there will be movement due to earnings coming out at close of bell. I will scalp real fast if I do, but I do not recommend traders to do this. This is a tricky time to trade since institutions re-balance their portfolios and only 30 minutes to trade.