Why Fridays Can be a Dangerous Day for Traders

Hey friend,

After yesterday’s Producer Prices report, we got the big CPI report this morning.

The numbers came in exactly in line with forecasts – showing a 0.4% monthly rise and a 3.4% annual one. These figures were also exactly the same as last month’s.

We also got some consumer sentiment data, which showed a sharp dip compared to both forecasts and last month’s figures.

Let’s see how markets have been moving.

The Daily Direction

Note: All indexes closed lower yesterday but gapped higher this morning – sending the medium-term direction of the S&P 500 back upward.

The Daily Nugget

Friday is a bad time to force trades.

Friday can mess with your head.

If you’ve had a good week, you want to finish strong.

If you’ve had a bad week, you want to claw some of it back before the market closes.

Either way, the temptation is the same:

Take one more trade.

That’s when standards start slipping.

A setup you would’ve ignored on Tuesday suddenly looks “good enough.”

You size a little bigger because you want the week to end on a high.

Or you jump into something late because you don’t want to spend the weekend thinking about the move you missed.

None of that has anything to do with the trade itself.

The market doesn’t know you’re trying to finish the week green.

And it definitely doesn’t care.

So if a great setup appears late on Friday, trade it.

But don’t manufacture one just because the closing bell is starting to feel like a deadline.

Sometimes the best way to finish the week is to leave the last trade alone.

The Traders Agency Team