The Chicago Mercantile Exchange (CME) is the world’s largest futures marketplace. Traders from around the world engage the CME on a daily basis, courtesy of its CME Globex electronic platform. The exchange’s regular business hours are nearly 24/5, but 11 U.S.-recognized holidays affect its schedule. Here is the CME Group’s futures market hours holiday schedule for 2020:
|Dr. Martin Luther King, Jr. Day||January 17-21|
|President’s Day||February 14-18|
|Good Friday (Easter Weekend)||April 9-13|
|Memorial Day||May 22-26|
|Independence Day||July 2-6|
|Labor Day||September 4-8|
|New Year’s||December 31 2020-January 4 2021|
The trading hours for each affected session on the CME Group’s 2020 holiday calendar are finalized two weeks prior to the dates in question. Before trading on these days, it’s imperative that you check with your broker regarding each market’s official opening and closing times.
If you’re going to actively trade during a holiday, remember that the days leading up to and following the event are frequently impacted. Often, an early close will precede the holiday itself, with the market re-opening at an unconventional time. Each of these factors can significantly impact liquidity, so you should account for them on a case-by-case basis.
Keys to Holiday Trading
Over the course of the year, holidays periodically halt or cease trading on the futures markets. From traditional celebrations such as Christmas and New Year’s to government and bank closures, business hours are subject to change.
As with most everything in futures trading, there is considerable nuance involved with the futures market hours holiday calendar. Here are a few important considerations to make before assuming risk during the observance of a holiday:
- Liquidity: During a typical futures market hours holiday session, participation levels tend to lag. Because many retail traders and institutional investors are out of the office, traded volumes decrease. When this occurs, wide bid/ask spreads, increased slippage, and chaotic price action become the norms.
- Shortened session: In many cases, holidays are observed by an early halt to trading instead of an outright market closure. For these sessions, intraday traders are faced with limited opportunities and urgent maintenance margin considerations on the premature close.
- News cycle: Unlike banks or the U.S. government, real life is not on a preset schedule. Surprise headlines and global market drivers are capable of occurring 24/7/365. If an untimely event takes place during a closure or abbreviated holiday session, price action can become unhinged very quickly.
In reality, the futures markets are open and at full-strength for about 249 days each year. If holiday action is especially thin or turbulent, then you don’t have to trade. Often, seizing the opportunity to take a much-needed break is more financially and psychologically rewarding than piling on the risk in less-than-ideal conditions.
If You’re Not Sure, Check with Your Broker
Holiday trading is no easy task. Many of the products listed on the CME feature specific business hours and unique liquidity concerns. Interest rates, ag markets, equities, and commodities all have different parameters. In short, one size does not fit all. Understanding when these markets open and close and what to expect is key to managing holiday sessions successfully.
For many, the holidays are a chance to take a break from the action of the market. However, if you’re going to trade, be sure to consult your broker’s futures market hours holiday calendar. To learn more, become a DT Insider to enjoy the benefits of Daniels Trading’s online Futures Calendar & Reference Guide.