Weekend Trading Strategies: What and How to Trade

Weekend trading allows traders to capitalise on markets outside regular hours. While stocks and forex generally take a break, cryptocurrencies remain active around the clock, providing opportunities for those interested in trading on Saturdays and Sundays. This article covers the essentials of weekend trading, including strategies, tools, and key risks.

Understanding Weekend Trading

For anyone wondering “Can you day trade on the weekends?”, the answer is yes. Weekend trading has seen rising interest in recent years, largely driven by the cryptocurrency market, which operates 24/7. While over the weekend, stock markets and forex trading are paused, crypto never takes a break, allowing traders to continue analysing and placing trades.

This continuous market access appeals to a growing base of traders looking to make the most of the quiet period when there’s generally less news and fewer participants. However, while weekend trading provides extra opportunities, it also presents unique challenges, primarily because it lacks the usual activity and volume seen during weekdays.

Weekend trading differs significantly from weekday trading, regarding market liquidity and price behaviour. Lower liquidity is a common factor in weekend markets, meaning fewer participants are actively trading. This can result in wider bid-ask spreads and greater price slippage, especially in volatile assets like cryptocurrencies.

Over the weekend, the absence of major institutional players and day traders, who dominate volume during the week, can lead to more erratic price movements. For those focused on technical analysis, this can be a double-edged sword: less volume may create clear range-bound trends or unusual breakout opportunities but can also magnify small price shifts, leading to quick but sometimes unexpected spikes.

Moreover, weekend trading often feels different because the news flow is slower. In a typical trading week, news events, economic data releases, and company earnings reports keep markets active and prices moving. On weekends, there’s usually a lull, which changes the rhythm of the market. That said, cryptocurrencies can still be heavily influenced by social media hype, announcements, or global economic developments, which can stir unexpected volatility.

It also means traders may rely more on technical analysis and sentiment indicators to gauge market direction. This shift encourages a different trading approach, as traders focus more on intraday patterns, weekend-specific support and resistance levels, and sentiment-driven volatility.

For anyone considering weekend trading, a key advantage lies in the ability to react to any missed news or market moves after traditional markets have closed. For instance, geopolitical tensions or significant financial updates might happen over the weekend, giving crypto traders a chance to respond early.

Why Some Markets Are Closed

The forex and stock market weekend closure reduces volatility and gives both institutional and retail traders a chance to rest. Also, closing on weekends provides a necessary break for financial institutions to perform maintenance, system updates, and risk assessments, ensuring smooth operation during the week.

Stock exchanges like the New York Stock Exchange (NYSE) or the London Stock Exchange (LSE) observe regular hours aligned with their regions’ business days, meaning weekend stock trading is unavailable. This structure also aligns with typical business and economic data cycles, as governments and corporations generally release major updates on weekdays, reducing the need for weekend trading.

Cryptocurrency markets, however, break this mould by remaining open around the clock. As a decentralised asset class, crypto operates independently of a centralised exchange schedule, enabling global access regardless of local trading hours or typical Wall Street weekend closures. This continuous operation meets the high demand for access and trading flexibility, especially as the crypto market remains relatively young and technologically driven.

Tools and Resources for Weekend Trading

Weekend trading, particularly in cryptocurrency, demands specific tools that help traders navigate lower liquidity and potentially heightened volatility. Here are essential tools and resources that can provide a valuable edge when trading over weekends.

Market Analysis Platforms

Market analysis tools are essential for monitoring real-time price changes, viewing historical data, and identifying trends. Platforms like TradingView and FXOpen’s TickTrader offer advanced charting capabilities with indicators and drawing tools to analyse price patterns, helping traders track critical support and resistance levels even over weekends.

Sentiment Analysis Tools

Sentiment analysis tools monitor public sentiment and news around assets, which can be especially useful in cryptocurrency markets where social media and news influence price moves. Tools like LunarCrush track mentions and sentiment for various crypto coins, allowing traders to gauge potential shifts that may impact weekend trades.

Risk Analysis and Management Tools

Weekend trading can be volatile, making risk management tools critical. Position-sizing calculators and volatility indicators can help assess the optimal trade size and potential market risks. Tools like CryptoRank’s volatility tracker allow traders to stay informed on price fluctuations, helping to mitigate sudden swings common in weekend trading.

Broker Platforms Offering Weekend Support

Choosing a broker with reliable weekend support is essential. FXOpen provides cryptocurrency CFD trading with continuous access to real-time market data, a stable trading interface, and responsive customer support. This ensures that traders can execute trades smoothly and respond to any sudden market changes, even during off-peak hours.

Key Weekend Trading Strategies

Weekend trading often presents unique conditions, with cryptocurrencies tending to trade in narrower ranges due to lower volume. To make the most of these conditions, traders frequently turn to strategies designed to capitalise on range-bound price action and weekend gaps. Here are two common methods:

Bollinger Bands and RSI Strategy

This weekend trading strategy combines Bollinger Bands with the Relative Strength Index (RSI) to take advantage of the typically narrow price ranges seen in crypto markets over the weekend. Bollinger Bands, with their upper and lower boundaries, highlight potential reversal zones, while RSI indicates overbought and oversold conditions. Together, they can offer clear entry and exit points when weekend volatility is lower.

To adapt RSI for the weekend’s reduced activity, traders often adjust its sensitivity, changing the usual 14-period setting to an 8-period. This adjustment makes the RSI more responsive, identifying overbought (above 70) and oversold (below 30) conditions more frequently.

When the price touches the upper or lower Bollinger Band and RSI crosses back below 70 or above 30, it’s often seen as a signal to enter a trade. For example, if the price hits the upper band and the RSI drops below 70, traders may consider it a short position signal, placing a stop loss just beyond the candle high. Profits might be taken as the price hits the opposite band, capturing gains within the weekend range.

Weekend Gap Trading

Weekend gap trading takes advantage of price gaps that can appear when markets reopen after the weekend, especially in assets like stocks or forex. Given that forex markets open on Sunday evening, there’s potential for weekend traders to take advantage of this strategy. However, it’s possible to apply this approach to any market that closes over the weekend, meaning traders can also take advantage of FTSE 100 or DAX weekend movements.

These gaps occur when the new week’s opening price is significantly different from its closing price on Friday, often due to major news, economic data releases, or shifts in global sentiment that accumulate over the weekend. Monitoring futures price movements, such as Dow futures weekend movements if trading DJIA, can provide insights into whether a gap may occur on opening.

Traders frequently employ a strategy called "gap filling," which relies on the tendency of prices to retrace to the previous closing level, "filling" the gap. This happens because the market frequently re-evaluates initial reactions to the news, leading prices to settle back toward previous levels.

The gap-fill approach typically involves waiting for some confirmation that the price will reverse toward the prior close. Traders often look for signals like resistance/support levels or technical indicators, such as moving averages, to confirm a potential reversal. They typically set a stop-loss order beyond the entry candle and a take-profit order once the gap is filled.

While gap trading can be effective, it requires disciplined risk management. Gaps are not guaranteed to fill, and external events can sometimes drive prices further in the gap direction rather than retracing.

Risks and Benefits

Weekend trading offers unique opportunities and challenges, especially in markets like cryptocurrencies that operate 24/7. Understanding the specific risks and benefits can help traders navigate this landscape more effectively.

Benefits

Continuous Market Access: Cryptocurrency markets remain open over the weekend, allowing traders to respond to news and events in real time without waiting for traditional markets to reopen.
Potential for Price Movements: Lower trading volumes during weekends can lead to more pronounced price movements, presenting opportunities for traders to capitalise on short-term volatility.
Flexibility: Weekend trading provides an option for those who cannot engage during standard weekday hours, offering a chance to participate in the markets at more convenient times.

Risks

Reduced Liquidity: Fewer participants over the weekend can result in lower liquidity, leading to wider bid-ask spreads and potential slippage during trade execution.
Unpredictable Volatility: The combination of lower liquidity and unexpected news can cause significant price swings. However, lower volumes can also equal reduced volatility, meaning weekend trading can be unpredictable.
Market Gaps: Events occurring over the weekend can lead to market gaps when traditional markets reopen, potentially impacting positions opened through the weekend.

The Bottom Line

Weekend trading opens unique opportunities, especially in round-the-clock markets like cryptocurrency. While it comes with added risks, using reliable strategies and tools can make weekend trading a valuable part of your approach. Ready to get started? Open an FXOpen account to access weekend trading in cryptocurrency CFDs with reliable platforms designed for active traders.

FAQ

Can You Trade on the Weekends?

Yes, trading is possible on weekends, but it depends on the asset class. Cryptocurrency markets, for instance, operate 24/7, allowing traders to trade on Saturdays and Sundays. However, most traditional markets, like stocks, are closed over the weekend.

Are Stocks Traded on Weekends?

Can you buy stocks on the weekend? No, weekend trading in stocks is unavailable due to the hours set by stock exchanges. For example, the New York Stock Exchange operates only from Monday to Friday. However, some venues may offer after-hours trading sessions, though these end on Friday evenings and resume on Monday mornings.

Can You Trade Forex on Weekends?

Forex trading usually pauses from Friday evening to Sunday evening, since major forex markets are generally closed on weekends.

What Can I Trade on Weekends?

The main assets available for weekend trading are cryptocurrencies, as they trade continuously. Certain brokers also offer weekend trading in limited forex pairs and select commodities or indices, though these options may vary and come with high transaction costs.

Why Do Brokers Work on Sunday?

The 24/7 nature of cryptocurrency trading has driven some brokers to offer support on Sundays, especially as demand for continuous trading access has grown.

Can You Trade on FXOpen on Weekends?

Yes, FXOpen offers weekend trading cryptocurrencies. For currency pairs and commodities, trading typically resumes on Sunday evening when global markets reopen.

At FXOpen UK, Cryptocurrency CFDs are only available for trading by those clients categorised as Professional clients under FCA Rules. They are not available for trading by Retail clients.