Carry costs inside the day: do overnight rates matter for scalpers?

[Amanhasnoname]

Interest rate differentials drive swap, and swap only applies when a position crosses rollover. For true intraday trading, it doesn't matter.

That said, rate differentials still influence price behaviour. Currencies with high yields tend to attract flows, and big changes in rate expectations move pairs hard. A scalper doesn't pay carry but trades the volatility it creates.

The rollover moment itself has effects. Some brokers adjust quotes slightly at rollover to reflect swap, and the spread can jump. Positions held through it face both the swap and the wide-spread moment.

A related issue arises with positions opened late in the New York day. A trade that was meant to be short can slide past 5pm because the exit wasn't hit.

The cure is a hard rule to be flat before the rollover window, and an alert that triggers a few minutes ahead.

Treating swap as irrelevant is fine as long as no position is left open.

Do you set a hard cut-off time for closing positions?