Home › Market News › Holiday Trading: How the Season Impacts Futures Trading
Your charts load like they always do. Your coffee’s hot. Your levels are mapped. But something feels… off. The market isn’t moving the way it usually does. Breakouts look fake. Pullbacks don’t pull back. And every time you think you’ve got a clean move lined up, it fizzles out or shoots farther than you expected.
Welcome to holiday markets.
From now through the first days of January, futures markets develop a personality of their own. They get quieter, then louder. Slower, then suddenly sharp. Predictable one minute, slippery the next.
Holiday trading strategies only work when you understand how seasonality affects futures markets, especially during thin-liquidity weeks (when fewer traders are active and price can move unpredictably) like Thanksgiving, Christmas, and New Year’s.
If you don’t understand why, it’s easy to get chopped up. When you do understand it, this season becomes one of the best times of year to tighten your discipline, protect your progress, and sharpen your edge.
Let’s dig into what makes holiday markets so unpredictable, and what you can do to stay one step ahead.
Every year, newer traders get surprised by the sudden change in behavior. Veteran traders, meanwhile, treat the holidays as a season with its own rules.
Understanding holiday seasonality helps you:
Let’s look at what really changes in the last few weeks of the year.
1. The Volume Disappears
Market volume doesn’t just decline. It often drops dramatically during major holiday weeks.
Traders take vacations. Funds wind down their risk. Institutional desks run on skeleton crews. And when volume thins out, everything gets exaggerated:
This is why holiday markets feel jumpy one moment and dead the next. There simply aren’t enough participants to smooth things out.
If you’ve ever watched price rip through a level “for no reason,” you’ve seen low-volume behavior up close.
2. Volatility Gets… Weird
Holiday volatility isn’t just lower or higher. It’s inconsistent.
You get fast spikes on nothing. Long drifts on even less. News events that barely matter during regular months suddenly hit like an FOMC bomb because liquidity is thin.
A setup that usually behaves reliably? It might stop two ticks short, or blow straight past your take-profit.
Experienced traders know: Holiday volatility rewards patience. Not pressure.
3. The Market Only Comes Alive in Bursts
Here’s a secret most new traders don’t realize: Holiday markets move in pockets.
You’ll see clean action in:
Midday during this time of year tends to be much quieter.
If you want to avoid holiday frustration, don’t force trades in the dead zones. The market is literally telling you when it wants to move.
4. News Matters More Than Usual
During normal months, minor economic reports barely move the needle. During the holidays? They can spark sharp, fast moves in minutes because liquidity is thin.
Everything hits harder when liquidity is thin:
Even small data surprises can move markets more than usual, but the exact size of the move depends on the product.
If you trade news events, the holiday season is not the time to be casual.
5. Year-End Positioning Creates Odd Flows
Not all holiday moves come from traders sitting at home. A lot comes from institutional repositioning:
This flow can create slow, one-directional drifts that don’t fit your usual technical logic.
It’s not your read that’s wrong. It’s that the market is being driven by motives you can’t see on a chart.
6. Holiday Hours Mean More Gaps
Thanksgiving, Christmas, and New Year’s all come with adjusted Chicago Mercantile Exchange (CME) hours. Shortened sessions and extended breaks lead to:
Sometimes they create opportunities. Sometimes they ruin perfectly good trades. Always, they demand respect.
If you’ve ever opened your platform after Christmas and thought, “What happened here?” you already know the deal.
Before every holiday week, check the CME schedule, so you’re trading with a full picture.
Holiday markets are not the enemy. They’re just different. And the traders who thrive during this season all do a few things right.
1. They lower their size.
Holiday moves can be sharp, sloppy, and unpredictable. Smaller size keeps you in the game without giving the market too much room to hurt you.
2. They take only A+ setups.
If you need to talk yourself into the trade? It’s a pass. Holiday markets reward clarity, not “maybe.”
3. They avoid FOMO trading.
One of the biggest killers during the holidays is impatience. Slow days tempt you to click just to feel busy. This is how traders take unnecessary losses right before a family dinner.
4. They use their risk tools.
TopstepX has features built for messy markets:
These tools help you stay disciplined when the market doesn’t give you much to work with. If there was ever a time to lean on your risk tools, it’s December.
5. They use December to prepare for January.
Holiday markets slow down just enough for you to:
January often brings fresh participation and new positioning flows, conditions that can feel cleaner, but nothing is guaranteed. Use December to make sure you’re ready.
If you want a front-row seat to how the pros navigate holiday volatility, watch the Crew on TopstepTV.
You’ll see:
It’s the fastest way to learn how holiday markets really move. Tune in to TopstepTV, fire up TopstepX, and step into the holidays with control and confidence. It’s everything you need to finish the year strong.
Holiday markets refer to the period from the last few weeks of the year through early January, when liquidity thins, volatility becomes inconsistent, and futures markets behave differently due to reduced participation and year-end institutional flows.
With fewer traders providing liquidity, even minor data releases can move prices more aggressively. Reports like CPI, NFP, and retail numbers often create sharper spikes than normal.
The core trading session becomes fragmented during the holidays. Volume is lower, spreads widen, and volatility becomes inconsistent. Clean moves are more likely to appear only in specific pockets, such as the open or the final hour, rather than throughout the entire session.
Yes. The late trading session tends to be quieter and thinner during major holiday weeks. This lack of participation increases the odds of false breakouts, sloppy drifts, and abrupt moves triggered by small orders or unexpected headlines.
Yes. Adjusted CME hours often shorten both the pre-opening session and the core trading session, which can lead to unusual gaps or opens that do not match the prior day’s rhythm. Traders should review the CME holiday calendar to avoid being caught off guard.
With fewer active participants on the trading floor and reduced liquidity across all sessions, even modest orders can push the market farther than expected. This effect is especially noticeable during the pre-opening and late-day periods.
The cleanest opportunities usually appear right after the open and sometimes during the final hour of the core trading session. Midday trading and late trading sessions tend to be choppier, and the pre-opening session often lacks enough structure to produce reliable setups.
Focus on fewer trades, wait for clear setups, reduce size, and avoid boredom trading. Tools such as Contract Limits, Trade Limits, Bracket Orders, and Daily Risk Lock help traders stay disciplined when the late trading session and other low-liquidity periods become erratic.
