The stock exchange facilitates the buying and selling of publicly traded securities. Stocks can be traded through different brokerages. Exchanges ensure that trading is fair and that each participant deals in accordance with regulations.
However, trading activity does not occur every day of the year as there are weekends, holidays and other dates when the market remains closed. The holiday schedule varies based on where an exchange is located.
For the markets that observe these holidays, no trading activity occurs. But is the U.S. stock market open to trade during Good Friday?
Is the Stock Market Closed on Good Friday?
Seasonality can be a massive part of an investor's trading strategy, so planning your trading during the holidays is essential. Some days see decreased periods of trading volumes, but many holidays halt trading altogether.
When is Good Friday?
Good Friday is the Friday before Easter, and many of the well-known exchanges are closed on this day. Good Friday is a Christian holiday, and with many other countries shutting up shop on the day, the lower trading activity means closing the markets makes sense.
Which Exchanges Are Closed?
Although it is not considered an official federal holiday in the United States or a typical bank holiday, stock markets are closed on Good Friday. As a result, markets in the U.S., including the New York Stock Exchange (NYSE), the Nasdaq exchange and the Chicago commodities exchange, close on this day, and many other countries follow suit. Bond markets close early on the day before Good Friday.
Foreign stock markets such as the London Stock Exchange, Hong Kong Stock Exchange and Frankfurt Stock Exchange are all closed on Good Friday.
Decreased Trading Activity
During the buildup to Good Friday and other holidays, you may see decreased levels of activity as traders take longer breaks and vacations. As a result, participants will see an impact on liquidity, profits and spreads. In addition, the risk factor during these periods may be higher.
Elsewhere, the commodities market closes on Good Friday. Thus, commodity traders must wait until the following Monday to enter or manage active trades.
However, not all stock exchanges close on Good Friday, as many nations do not celebrate the holiday. In addition, it is not a priority for some exchanges, and as a result, they remain open during the holidays.
For example, the Saudi Stock Exchange is closed on its national holidays, none of which include Good Friday. As a result, you are able to trade securities listed on the Saudi Stock Exchange on Good Friday. Saudi regulations restrict foreign investors from entering the Saudi Arabian markets. Its law limits foreign investment to financial institutions and billionaires. The exchange also limits the number of shares foreigners can buy, and only investors with the deepest pockets can gain exposure. Therefore, it is unlikely the average investor can use the Saudi Stock Exchange to trade during Good Friday.
The foreign exchange market remains open during Good Friday each year, and trading resumes as usual. Forex traders can keep on trading despite other markets being closed. However, participants should be aware that liquidity will be low, and brokers will usually increase the spread on most pairs during this period. As a result, many forex traders will also take Good Friday off.
Can You Trade Crypto on Good Friday?
Unlike the general stock and commodity markets, cryptocurrency markets are decentralized and not traded on a regulated exchange. The market has gained significant popularity in recent years, as seen with the substantial rise of Bitcoin. The idea of a decentralized currency is one of the many reasons it grew in popularity.
The crypto market is open 24/7 regardless of holidays. This benefit offers traders the opportunity to trade during Good Friday or any other holiday. Since crypto is not regulated or overseen by one organization or authority, trading does not stop.
Is it Beneficial for Crypto Traders to Trade During Good Friday?
Despite the crypto market being nonstop, trading activity can vary, and during Good Friday or other holidays, the crypto market may see significantly reduced liquidity and volatility.
Many crypto traders prefer to take Good Friday off despite the market being open. In addition, outside of regular trading days and hours, traders may face weaker exchange rates and could have difficulty selling.
When liquidity declines in the crypto market, it becomes difficult to buy and sell crypto coins efficiently. Higher liquidity is associated with lower risk. As a result, crypto traders may find difficulty in making transactions at the price they prefer. This factor may cause a rise in the bid-ask spread and generate further decreased liquidity.
Despite the crypto market remaining open at all times, it is not always beneficial for traders to enter during holidays such as Good Friday. The times the crypto market can face its lowest volatility is during national holidays or weekends.
The market is always available if you wish to trade crypto, but the costs of spreads and difficulty in the transactions may not be ideal.
How Does the Market Behave Before and After Good Friday?
Easter can be an unusual time for the stock market. The market closes on Good Friday despite not being a national holiday. But leading up to and after the big day, does the holiday cause unusual trading patterns or irregularities?
This answer is not definitive, and measuring the market's behavior is complex. However, while your trading plan shouldn’t just rely on seasonal irregularities, the market tends to establish certain habits, which will be important to note during the holidays.
Wall Street's Take
Wall Street suggests that, in general, the market trends higher heading into the Easter weekend. The Thursday before Easter is usually a positive one. However, there is no way to predict the market perfectly each year, and any trading heading into Easter would be entirely based on speculation.
For example, on Thursday, April 14, 2022, the S&P 500 fell by 1.21%, and the Nasdaq decreased by 2.28%. Therefore, the S&P 500 did not support claims of an upward trend during the Easter holiday.
Trading can be scattered before Good Friday. How do the markets fare after the Easter holiday?
According to GoBankingRates, referencing research from Schaeffer’s Investment Research, when the markets are higher year to date going into the Easter weekend, they tend to remain higher by the end of the year. Furthermore, for the past 30 years until 2018, the correlation was extremely high and should be considered by investors.
However, when the market is down heading into Easter, it remains lower towards the end of the year.
Noticing Market Patterns
Overall, market patterns can be found when assessing Easter trends, but a substantial amount of research is needed to find and trade them.
Just because the market moves higher heading into Easter, this should not be your sole argument to buy a specific stock or index. Stick to your trading strategy and keep a note of what could occur during these times. If you notice a potential pattern when back-testing, then it may be something to watch.
The stock market is closed on Good Friday in the United States and other countries that observe the holiday. Major exchanges like the NYSE and Nasdaq, as well as foreign stock markets, are closed. However, not all stock exchanges close on Good Friday. The foreign exchange market remains open with reduced liquidity. The cryptocurrency market operates 24/7 but may have reduced liquidity and volatility. Traders should be aware of these market behaviors and plan accordingly.
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Frequently Asked Questions
Why is the market closed on Good Friday?
Although it is not an official federal holiday, the NYSE and the Nasdaq exchange have traditionally been closed on Good Friday.
Is the stock market open on Easter Monday?
The market is open on Easter Monday. The stock market closes on Good Friday and reopens the following Monday. It is back to business on Monday, and trading activity returns to usual.
What other days are the stock markets closed?
The stock markets are closed on weekends (Saturday and Sunday) and on certain holidays such as New Year’s Day, Martin Luther King Jr. Day, Presidents Day, Memorial Day, Independence Day, Labor Day, Thanksgiving Day and Christmas Day. Some stock exchanges may have different closure schedules or early closing times on certain days, so it is best to check with your specific stock exchange for accurate information.
About Sam Boughedda, Stock Market Analyst
He is an expert in the following spaces: stock market news writing, analysis, and research.