Good morning. If you only knew… Tuesdays have a special place in trading history. In 1929, the infamous Black Tuesday crash wiped out billions, marking the start of the Great Depression.
Since then, traders joke that Tuesdays can either be the market’s luckiest bounce or its most brutal reminder.
-Shaun A, Jonathan Kibbler, Jordon Mellor
MARKETS
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TRADER INSIGHTS
The Tuesday Effect: A Pattern You Can’t Ignore
If you only knew this last year… you might have looked forward to Tuesdays instead of dreading Mondays.
Markets don’t just move on news, charts, or sentiment. Sometimes, they move on the calendar. And one overlooked quirk, backed by decades of research, is that Tuesday consistently outperforms other trading days.
Here’s what you need to know and why it matters:
1. The “Day-of-Week Effect” Is Real
Researchers have studied market returns by weekday since the 1970s. The Monday Effect showed stocks often slump to start the week but by Tuesday, markets rebound. In U.S. equities, Tuesday has delivered above-average returns compared to any other weekday
2. It’s Not Just Stocks FX Feels It Too
While the S&P 500 gets most of the spotlight, the rhythm spills into forex.
Liquidity deepens on Tuesdays after the quiet Monday opens, making breakouts and ranges more reliable. For swing traders, that means Tuesday entries often catch better momentum.
While FX-focused weekday studies are scarce, the general financial markets research shows robust weekday patterns in liquidity and trading activity, with Tuesdays regularly topping the charts.
Given the interconnectedness of global markets especially between equities and FX it’s reasonable to infer a similar rhythm in currency markets as weekday structure and participation rebound mid-week.
3. The Numbers Don’t Lie
MarketWatch reports that over long stretches, Tuesdays tend to post stronger gains than Wednesdays or Thursdays, even adjusting for volatility. This isn’t magic, it’s how institutional flows settle after Monday positioning. Academic studies confirm the persistence of this bias across multiple decades and regions.
4. How to Spot It Yourself
Don’t take it on faith.
Tools like TradingView’s bar replay and weekday filters or MarketBulls’ seasonal charts let you check performance day by day. Even simpler: tag your trades by weekday in a trading journal. You may find your personal win rate aligns with this pattern.
5. A Subtle Edge, Not a Holy Grail
This doesn’t mean you blindly buy on Tuesdays. And you’d be like “Oh it’s Tuesday, I need to push my trades”. Nahh! that won’t work
Edges get weaker over time as more traders exploit them. But context matters. Knowing that Tuesday tends to bring higher flows and stronger moves can keep you patient on Mondays and more alert on Tuesday setups.
My Takeaway
Patterns like the Tuesday Effect won’t make you rich on their own, that’s for sure. But they remind us that markets have rhythms beyond the obvious.
If you only knew that Tuesdays tend to carry hidden strength, you might time your entries with more confidence. Sometimes the edge isn’t just in the chart it’s in the calendar.
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LEARN
This interesting tool is probably one you’ve never heard of.
If you’ve been following markets for a while you know that traders don’t just care about whether the data is good or bad. What really moves the market is whether it’s better or worse than expected.
That’s where the Citigroup Economic Surprise Index (CESI) comes in.
What is the Citi Surprise Index?
This index tracks how actual economic data releases compares to the forecasted data.
A positive reading and a climbing index shows that the data is beating expectations. In this condition traders may consider the economy is getting stronger, which could lead to adjustments in central bank policy.
On the other hand, a negative trend shows that the data is disappointing vs the forecasts. Again in these conditions traders may consider the economy is becoming fragile, which could lead to an easing of central bank policy.
Think of this as a sentiment tool.
I made my own version of this that you may be familiar with here:
This one isn’t as pretty or as visual as citi’s but this is of the same vein. I wanted to understand if it can create a strength meter and here it is in its simplest form.
What does the index say about the US right now?
Since the end of July the index highlights that data has been beating forecasts pushing the index into a positive territory.
Despite the US labor market problems, other data points have been upbeat which is why the index is rising.
Here I have overlaid the Citi surprise index on top of the USD index, so you can see how this can work.
At the beginning of the year the data was disappointing, the USD followed. Recently the Citi index has been tracking higher however the USD index has remained range bound. Which is interesting.
For me I think if the US labor market data begins to shift to become more positive, it could be a catalyst for USD shorts to unwind.
However, I like to use this as a sentiment indicator so it’s always used in the confluence with other factors.
Should you care?
Of course you should. As retail traders we should be looking at the fundamentals, the data points and the trajectory of these. To me this current move higher could be an early signal for a potential reversal in the USD, especially as this USD short position is becoming overcrowded.
GAMES
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ANSWER
Answer: Pip (Percentage in Point)