Which Trading Hour Is The Best? When Should You Buy And Sell During The Day?

There is no best trading hour. Backtests of five different futures contracts reveals that most of the price action is random throughout the trading day. However, by implementing one or two extra variables, we find some potential trading edges or strategies.

We backtest the following trading rules:

We buy at the open every hour and sell at the close of the trading day. The close is defined as the close of the “regular” trading hours local time.

For example, the S&P 500 futures contract is traded in Chicago and we defined the open at 0830 local time and the close at 1500.

For gold, oil, and silver the open is 0930 and the close is 1600 because it trades in New York.

All of the contracts trade much longer (and earlier), but for convenience, we defined the open and close like above.

We test one-hour intervals: 0830, 0930…..1530. Thus, the last time interval is only 30 minutes and we only look at regular trading hours, not the 23-hour session.

In the gold price the average gains are practically zero (Shown in the table below)

You can find more info about this trading strategy here:
https://www.quantifiedstrategies.com/what-trading-hour-is-the-best/

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