While the Forex markets are open continuously throughout the week, they do close on the weekends. This situation may pose a problem to you if you hold a position going into the weekend. There is no clear cut answer on whether or not to hold the position over the weekend. Rather, the right answer depends on your personal Forex trading goals.
Clearly, the question of holding a Forex position over the weekend only applies if you are a short-term trader. If you sometimes hold positions overnight, you may opt to hold a position over the weekend as well. However, if you trade strictly on an intra-day basis, stick with your trading plan and close out your position before the weekend.
Holding a position over the weekend entails a certain amount of risk. Although rare, notable weekend price gaps do occur. Assess your risk tolerance level and account size and decide if you are willing to take on this risk.
If you set profit and loss targets when entering a trade, you may consider holding a position over the weekend. Stick to your trading plan, so if you only exit a trade once it hits a predetermined profit or loss target, attempt to follow through with your plan. On the other hand, if you wish to reduce your overall risk, make a rule that you will never hold positions over the weekend.
Ultimately, the choice to hold a position over the weekend comes down to your personal goals and preferences. If you are a conservative trader looking to minimize risk, do not hold positions over the weekend. Also, if you find yourself becoming stressed out when holding positions over the weekend, either stop holding the positions or trade smaller positions.