One of the greatest characteristics of the Forex market, as mentioned earlier, is that it is open 24 hours a day, 5 days a week. This means that investors around the globe can trade whenever they want to throughout the working week.
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However, not all times are created absolutely equal. There are Forex trading times around the world when price action is consistently volatile , and there are also periods when it is completely muted. Multiple currency pairs display varying activity over different times of the trading day thanks to the general demographic of those market participants, who are online at that particular time.
Market Hours & Holidays |
This pushes us to accept the major trading sessions in Forex as being directly interconnected with market hours. Even though a hour market offers a substantial advantage for many individual and institutional traders , as it guarantees liquidity, and a solid opportunity to trade at any possible time within the established Forex hours of trading, it is not deprived of certain pitfalls. Although different currencies can be traded anytime you wish, a trader cannot monitor a position for such long periods of time.
This implies that there will be Forex trading times when opportunities are missed, or even worse, when a jump in market volatility leads the spot to move against a set position when the trader is not nearby.
To reduce such a risk, a trader has to be aware of when the market is most commonly volatile, and therefore decide what times are best for their individual trading strategy and style. Typically, the market is separated into three sessions during which activity is at its peak: the Asian, European and North American sessions.
More commonly, these three periods of Forex trading hours are known as the Tokyo, London, and New York sessions. Such names are used interchangeably, simply because these three cities represent the key financial centres for each region. The markets are most active when those three powerhouses are conducting business - as the majority of banks and corporations make their daily transactions.
There is also a greater concentration of speculators online.
Forex Trading Sessions
Let's look at the Forex trading times on the clock for each region. I have provided them in the more universally recognized GMT. When liquidity is restored to the Forex market after the weekend, the Asian markets are naturally the first to observe action. In other words, Forex market trading hours start there. Activity although not officially from this part of the world is actually represented by the Tokyo capital markets, which are live between - GMT. Nonetheless, there are a lot of other countries with considerable pull that are present during this period, including Australia, China, New Zealand NZ , and Russia, which influences the best Forex trading times in places like NZ.
Taking into account how scattered those markets are, it makes sense that the start and end of the Asian session are stretched beyond the standard Tokyo market hours for Forex.
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In fact, to allow for these different markets' activities, Asian hours are frequently considered to run between - GMT. Later in the trading day, just before the Asian trading hours come to a close, the European session takes over in keeping the currency market active. This Forex time zone is very dense and involves many key financial markets.
London takes the honour of identifying the parameters for the European session, which influences the best Forex trading times in the UK. Official business hours in London run between - GMT. This trading period is enlarged owing to other capital markets' presence including France and Germany before the official open in the UK, whilst the end of the trading session is pushed back as volatility holds until London closes.
When the North American session comes online, the Asian markets have already been closed for several hours, but the day is only halfway through for European FX traders. The Western session is influenced by activity in the US, with a few contributions from Canada, Mexico, and other countries in South America. Not surprisingly, activity in New York marks the high in volatility, as well as participation for the session in North American Forex market hours GMT. Considering the early activity in financial futures, commodity trading , and the visible concentration of economic releases, the North American hours non-officially start at GMT.
With a substantial gap between the close of the US markets, and the Asian Forex market opening hours, an interval in liquidity establishes at the close of the New York exchange trading at GMT, because the North American session comes to a close. There are two periods of the year in which the Forex markets are closed. Forex trading times on Christmas and the New Year are difficult.
Your see, the share market opens during the morning and closes in the afternoon but the forex markets does not operate in this manner. As a matter of fact, the forex market is a 24hr market. Which means, the forex market follows the sun around the world. Which means you can be anywhere in the world and trade the forex market from your laptop as long as you have an internet connection.
Well, forex trading sessions are different periods during the day at different parts of the world where forex is traded DURING the day. Now, lets look at the forex trading times for each of the forex trading sessions mentioned above.
Forex Market Hours For London Session
Note: the times below are given in GMT. You need to convert these times to your appropriate time zone. If you live in Australia in Queensland, the following table give you the start and end times for the different forex trading sessions in your own time:. This time period usually offers the most liquidity for the Japanese Yen, as well as the European Yen crosses. Another good time to trade in order to take advantage of several different markets being open simultaneously, is between PM and AM as Asian and European markets overlap at different points.
The Tokyo, Singapore and Hong Kong forex markets continue trading throughout this overlap period. This time period tends to have the most liquidity for the Australian and New Zealand Dollars and their crosses. You can also trade into the thinner markets in New Zealand that opens at pm and Australia which opens at PM.
This represents a window of time during the trading day, when the market could be thin and so price spreads may widen significantly. Basically, avoiding trading during illiquid time periods and in highly volatile markets can save you money, both in terms of your trading position and in the amount of the bid offer spread you may be quoted for the transaction. Other times which may not be as advantageous to trade include the Sunday night session, as well as Fridays when the market is looking forward to the weekend and so typically trades counter-trend as positions are squared.
Another risky trading time is when important numbers such as U. Non-Farm Payrolls come out. Read more about the non-farm payrolls and implications for the forex market.