Someone asked me Friday morning during Pre-Market Prep, “How do I trade pre-market?”
Wow, what a loaded question!!
I kept my answer short and to the point…
“If you’re asking me that, you’re probably new, so you have no business trading pre-market.”
Premarket trading is a huge taboo for new traders. I beg you not to do it.
Stocks are extremely volatile during that time…They can turn on you in an instant, and you risk wiping out your account in the blink of an eye.
And especially now, when the broad market is all over the place trying to react to the endless headlines, pre-market trading may be something even seasoned traders should avoid.
Cased in point: on Friday morning, the market surged on job growth data that was weaker than expected but still stable…
And then it pulled back again…more proof that it’s impossible to know what will happen from one minute to the next.
This is the S&P 500 from Friday…
SPY Intraday, 1-Minute Candles Chart; SteadyTrade
To be clear, as I said in Friday’s blog post, the market is not in freefall nor is it crashing.
However, I do want traders to exercise greater caution than usual while we’re in a market with low visibility.
If you are ready to trade before the market opens, read my blog post to learn more about how to do it.
And if you’re not ready or want to stay out of dangerous waters for now, there are plenty of ways to trade after 9:30 am ET and still get in on some awesome price action.
One of my favorite strategies for new traders is the 9:45 AM Rule.
But I have another approach you can use to trade with less risk and still catch the big gainers.
Limit Your Trading To Only One Hour
Yes, I said only one hour…
And no, I’m not saying this is the only strategy for new traders, but it’s one that works really well.
Hear me out…
If you’re new and you’re just getting into the crazy, high-volatility movers, the kind that jump 200% in a day, this might be the strategy for you.
To trade them, you have to understand how they move, the mechanics behind them, and most importantly, the right time to trade them.
The 2:00 PM Window Could Be the Best Time to Trade
When I refer to the 2 PM Window, I mean roughly 1:45 to 2:45 pm ET.
Why?
Because this is when some of the best risk-to-reward setups happen.
I love the Dip and Rip strategy in the morning, but it’s fast, volatile, and easy to screw up, especially if you’re new.
Morning failures? They slam down hard, blowing through stops, turning what you expected to be a small loss into something much bigger before you can even react.
But afternoon failures? They usually fade gradually, giving you time to get out without it becoming a disaster.
Besides the obvious “less scary” benefit of afternoon trading, it’s the sweet spot for part-time traders or those trying to build a small account.
Always, always prepare before you start trading for the day…
And then be ready at that 2 PM window to focus and trade the quality setups.
To spot those trades, you need a robust trading platform with real-time data, charting, stock screening, and more.
I use StocksToTrade every single day. It’s got all the scanners, charts, and tools you need to stay ahead of the game.
PLUS, right now, you can get two weeks of both the STT platform and our Breaking News Chat service for $17.
Grab your 14-day StocksToTrade + Breaking News Chat trial today for only $17!
My Final Thoughts…
As a new trader, you’re going to lose. It’s part of the game and you have to accept it.
But your job isn’t to not lose—it’s to avoid disasters.
The afternoon window helps with that because even when you mess up, the damage is usually limited.
In contrast, in the morning, one mistake can wipe out a week’s worth of gains in seconds.
Do your prep in the morning, run your scans, study your strategies, and when 2:00 PM rolls around, you can start pressing buttons.
As a new trader, your #1 goal is to stay in the game. For that, the 2 PM Window comes in really handy.
For more trading mentorship, strategies, and advice, join my StocksToTrade Advisory service.
You’ll get a monthly newsletter with a list of my top picks, three weekly videos with my watchlists, bonus reports, and more.
Sign up for StocksToTrade Advisory right here!
Have a great day, everyone. See you back here tomorrow.
Tim Bohen
Lead Trainer, StocksToTrade