Summer period is usually the time when the market is ranging. This is because most banks and hedge fund managers are on their vacations. They are either enjoying their sweat or they are rethinking their strategy for the next trading period. Since these traders are not there, there are not enough traders that can force a trend to show.

For instance look at GBPJPY, since yesterday, i.e Sept 1st, it has been ranging. I cannot believe that. GBPJPY is a volatile currency pair. Its daily range is about 300 pips, but it moved about 150 pips yesterday. This means that a new trend is developing. I believe the trend is up since the world’s economy is sloly improving. But the question is when will the developing trend become visible? This is a question that only few people have an answer to.

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Friday is Non farm payroll, so there is a possiblity that the trend would develop. I think the trend would become clear next tuesday, after USA labor’s day. That is the official time whn work resumes. So when work resumes, most traders in financial institutions would be back to work.

Some traders that claim that they trade for a living usually go on their own vacation during summer time because the market is usually ranging. They don’t want to lose or give back their earnings. And really, ranging markets can break someone’s account. The only way to trade a ranging market is to know the high and lows of the market, then you trade it. Another way is to go for smaller pips. If you usually take 100 pips per trade, you would have to reduce the amount of pips you want. You can go for 50 pips or less, so that you can survive to see tomorrow.