When is the Best Time to Buy and Sell Stocks?

As someone who always has a pulse on the stock market, it took me a long time to figure out the best time to trade stocks. Today I’ll share my years of knowledge having watched the pre-market, official trading hours, and after hours trading and give you my take on the best times to buy and sell stocks.

Let’s get right into my findings.

Best Trading Sessions

For me, there is nothing more profitable than trading the premarket.

Premarket Trading

Pre-market trading opens at 4 AM for the New York Stock Exchange and the NASDAQ.

Since I’m in the U.S. and live on the eastern time zone, this is a huge advantage for me. I get up early naturally and have had massive successes buying stocks in the morning before the market opens, especially when a company does a press release or has major news events that are announced before the stock market opens at 9:30 a.m.

Schwab allows me to trade stocks as early as 7:00 a.m. but there are brokerages like WeBull that start even earlier. Typically trading from the time premarket begins until the market opens is a great way to take advantage of lower volume and typically much less volatility, especially in large cap stocks.

Can Anyone Trade Pre-Market?

Yes, all traders can request to trade the market before it opens at 9:30, but a lot of it depends on which broker you use. Some of the notable ones are Fidelity, Schwab, Robinhood, and WeBull.

Morning Session

The morning session usually dictates how the day is going to go overall, and it’s generally when everyone jumps in with two feet. Volume really picks up after 9 AM and flows into the morning session, which officially opens at 9:30 AM.

A typical morning session will see high volumes of trading from the time the market opens until about noon. Most media reports, including “Power Lunch,” dissect and report the morning session trading at noon and talk about the day’s events.

Many day traders pick up positions before the market opens and gauge their sentiment about how a stock will do around the time the market opens. If the market starts heading south, a lot of day traders get out for the day and secure profit (or cut losses) early on in the morning. The morning session is the preferred time for most day traders to make their moves and you’ll see a lot of price action during these periods.

What is the Best Time to Trade in the Morning Session?

Most traders are very active from 9:30 – 10:30 a.m due to high trading volume.

Is it Good to Trade in the Early Morning?

Trading in the morning any day of the week can be a solid trading strategy. In fact, most day traders are done for the day by 11:30 a.m.

What is the 10 A.M. Rule in the Stock Market?

Most traders feel the shape of the market conditions will be set by 10:00 A.M., and a study posted on CNBC showed that if you bought the market at close and sold your positions by 10:00 A.M. the following day, you would have made 9 times your money if you did this every day since 1983. One point made was that mutual fund flows often happen at market open and affect market behavior from many investors.

Lunch Session

I typically sit out the lunch session as that’s when I take a break, run errands, and well, eat lunch! (Despite Gordon Gekko’s notion that “lunch is for wimps!” in one of the greatest stock market movies of all time!)

Not that I don’t have an eye on the market, but for me, most day trading happens very early in the morning. I find the trading day to be grueling at times, and this is a time I usually take a break.

You’ll see volatility go down to a lot of traders taking this time away from the market, which typically lasts from 11:30 – 1:30.

Does the Stock Market Break for Lunch?

No, the market remains open during lunch hour.

Afternoon Session

The afternoon trading session brings new eyes to the market as people in different time zones, especially in the Pacific Time zone, enter the markets fully concentrated. It also brings back day traders who may have made full exits in the morning session but are looking to find value late in the day or even overnight holds to sell in the next day’s pre-market session.

For me, I mostly do stock analysis during the afternoon and unless a stock is on a big surge and has gained momentum throughout the day and I decide not to hold it overnight, I normally don’t make trades during these hours. Also, many traders cut losses on stocks they had hoped would move throughout the day so the market can be a bit wild. There still can be late day news, but a lot of companies like to announce those types of things during after hours trading to fuel the next morning’s media coverage of the financial markets. In a world where we can get news 24/7 thanks to the Internet and social media (Twitter is a great place to get stock news), the market never really sleeps!

Afternoon vs. Morning Session Trading

I find a lot more volatility in the morning and a lot more buying opportunities in the afternoon if I’m being honest. If I’m looking for an overnight hold, buying late in the afternoon before market close is sometimes a strategy I use to find value.

After Hours Trading

Like pre-market, the after hours trading session is more thinly traded and has a lot to do with after market news releases and press released. There can be major movements after hours, but again, the volume is down compared to the normal day trading hours.

What Time Can You Trade Stocks After Hours?

After hours trading runs from 4:00 p.m. to 8:00 p.m.

When is the Best Time to Buy and Sell Stocks?

There is no “best time to buy and sell stocks” as a lot of the trading will depend on your ability to do technical analysis, buy at the right time, and sell at the right time. I recommend finding a time to trade and stick to it. For me, it’s pre-market, early morning as markets open, and the last hour of the trading day. If you use a buy and hold strategy, buying late in the day can be a good time to buy. Selling stocks before 10:00 has been shown to be a good strategy as a stock price can drastically alter it’s course after the first hour of the day.

Please note, this is simply my experience trading and I’m not offering financial advice. Always use risk management practices to help you generate positive returns.