What are The Best Forex Trading Times

24 Hours Forex Trading

Trading TimesIn the world of Forex (Fx) Currency Trading we are at a major advantage in terms of trading times and I will illustrate. 

A question I hear a lot with new traders to the forex world is: "What are the main Forex Trading Hours?" or "What is the Forex Trading Schedule?"

No need to worry about any of that. With Fx Trading, you may trade 24 Hours A Day if you so choose. Cool right! Yes, very cool! This is one of the major advantages of Trading Forex. Once you open an account with an Online Broker and after learning the ropes, you will soon find this scenario a major advantage. You could trade when it suits you. This makes it perfect for people for whom other commitments in life take major priority. 

The world is a vast place and as such, we have Different Time Zones. So when one country ends its trading day, another starts. In other words, this means that Forex almost never stops! The major Financial Markets in the world have overlaping times. The heaviest trading takes time during this overlapping period and presents abundant trading opportunities.

Traders new to the world of Currency Exchange Trading tend to think that since the market is open twenty four seven, they may trade whenever they choose during the day. Although this is true, it requires some clarity. When it comes to Currency Trading, some hours present better opportunities than others. This suggest better profit potential. Therefore choosing good trading times should be an important factor to consider once you enter the world of trading forex.

What are the Best Trading Times?

The Best Time to enter Fx Markets is when large volumes of currencies are being traded. At those hours, traders can take full advantage of Fx benefits. Since Forex markets trades 24 hours a day, the best time to enter is when several countries are trading at the same time. In each time zone across the world, Forex Markets operate from 8am to 4pm. So, to take advantage of the heavy trading volume, its worthwhile to determine when the Forex main trading hours in different countries overlap. The more the countries are actively trading, the larger the trading volume and the bigger the Pip Movements. I will be describing Pips in a later article. When currencies are the most active, that’s when traders have a better chance of making a profit. Slow markets offer little chance of profit and therefore Forex traders usually stay away.

Forex Trading opens in New Zealand, followed by Australia, Asia (and particularly Japan), the Middle East, Europe (with London being the main financial center) and then America.

Trading Sessions GMT (Greenwich Mean Time):

Okay, Since I operate in the GMT Time Zone, here are the main Forex Trading Hours in this time zone.

Summer Open: Sunday, 10:00 pm GMT   Summer Close: Friday, 09:00 pm GMT
Winter Open: Sunday, 11:00 pm GMT   Winter Close: Friday, 10:00 pm GMT

The Fx Market follows the sun around the world with opening of Financial Centres in Different Time Zones starting from Asia and finishing in America. Opening times of the main trading sessions are:

Main Financial Centers Opening and Closing Times

Summer GMT

Sydney Open: 10:00 pm Sydney Close: 07:00 am
Tokyo Open: 11:00 pm Tokyo Close: 08:00 am
London Open: 07:00 am London Close: 04:00 pm
New York Open: 12:00 pm New York Close: 09:00 pm

Winter GMT

Sydney Open: 09:00 pm Sydney Close: 06:00 am
Tokyo Open: 11:00 pm Tokyo Close: 08:00 am
London Open: 08:00 am London Close: 05:00 pm
New York Open: 01:00 pm New York Close: 10:00pm

You can see that in between each main trading session, there is a period of time where two sessions are Open At The Same Time. From 07:00-08:00 am GMT, the Tokyo session and London session overlap, and from 12:00 - 04:00 pm GMT, the London session and the New York session overlap.

Such division of the market into trading sessions allows traders to determine their own Individual Trading Time. The important thing that should be mentioned is that all sessions have their own features and peculiarities.

When traders for the Asian Markets are starting to close and exit their trades, their European counterparts are just beginning their day.

While there are Several Financial Centers all around Europe,  it is London that Forex Traders keep their eyes on. London trading session is the largest in volume and number of transactions. Historically, London has always been at a center of trade, because of its strategic location. Traders have dubbed it as the Forex Capital of the World with thousands of businessmen making transactions every single minute. About 30% of all forex transactions happen during the London session.This affects the market volatility so it is the time of active market movements. New York Trading Session is least active, but very Liquid. Besides, during the time when the London session has not yet closed and the New York session is already open the majority of deals are executed. I often find that a lot of traders try to trade at these times. But each to their own as they say.

Trading Times To Your Advantage:

There is so much liquidity during the European Session and countless transactions take place that almost any pair can be traded. With this knowledge it may be best to stick with the Majors (EUR/USD, GBP/USD, USD/JPY, and USD/CHF), as these normally have the tightest spreads. Also worth noting is that these pairs that are normally directly influenced by any news reports that come out during the European session. You may also try the yen crosses (more specifically, EUR/JPY and GBP/JPY), as these tend to be pretty volatile at this time. Because these are Cross Pairs, the Spreads might be a little wider though.

Knowing when the markets are Active or Slow is vital for all Currency Traders. For the Short-Term day Fx Trader, basing trades around the more volatile periods of the day increases the probability that the trade will be at your advantage. For Longer-Term Fx Traders, a slow down in price action presents a better period to enter a trade. With this kind of knowledge and reasoning, you are probably more likely to increase your confidence in these very tricky markets in time. But always be careful with whichever angle you choose to strike at. 

Well that should sum up the major trading times and how these times affect fx currency trading.

If you arrived here first and are a newbie, start by learning What is Forex Trading.

If You are ready to Trade, Our selected list of Online Forex Brokers should get you started with a Demo Account.