Beginners are usually highly excited and passionate to kick start their forex trading that they overlook many crucial things, and one of them is the forex hours.
They spend time checking a lot of economic calendars, and they also watch the foreign exchange market 24-hours five days a week. All these things lead to making that passionate trader bored and lethargic.
So, don’t be a fool and rather work smartly and for that, you should understand forex hours and try to find out the best hours of the forex market you’ve planned to start trading with.
The Forex Market Hours For Operation
The Forex Market Hours vary from country to country. So, it is imperative to discuss the four famous markets. Let’s delve into the article to get insights into the four major forex markets in the world.
The New York market opens at 8 a.m. EST and closes at 5p.m EST. And in the forex world, it holds great significance because it is the second-largest trading platform globally. The U.S. dollar has a high significance in international trading or markets because almost 90% of all trades have dollars involved in them.
The overlap is when the U.S. forex and the London sessions both overlap. It is worth mentioning that these markets are the biggest forex markets. This overlapping time usually lasts for four hours, and during this period, there is the massive possibility of a large amount of liquidity.
The Tokyo market’s opening time is 7:00 p.m., and its closing time is 4:00 a.m. This market starts its operation before the opening of the Hong Kong and Singapore forex markets in Asia. That’s why it has a huge bulk of traders. The most used currency pairs in the Tokyo market are the U.S. dollars vs. Japanese yen, British pound vs. Japanese Yen, and British pound vs. Swiss franc.
During the time when the Tokyo market is the only market operational, it is better to go for USD/JPY. The reason behind it is the Bank of Japan’s huge impact on the market.
Sydney forex market opens at 5 p.m. and closes its operation at 2 a.m. Among the big markets, it comes last. Owing to this, there is a lot of activity (because the traders aim to regroup after the long gap) when the market starts operation on Sunday afternoon.
The London (Great Britain) market starts operation at 3 a.m. and remains open till noon. The U.K. market has a significant role in the currency markets throughout the world. And it is pretty obvious that key part of it.
It is also important to mention here that as per BIS’s report, approximately 43% of the world’s trading takes place in London; therefore, we can say that it is the world’s central trading center.
The Bank of England headquarters is located in London. The bank is involved in controlling GPB and setting the interest rates; that’s why London has a significant effect on the fluctuations in the country.
In addition, if you are a technical trader, it becomes more valuable for you because forex trends arise from this place. It is pertinent to mention that there is an investigation for finding out the opportunities in technical trading by utilizing the price movement, statistical trends, and momentum.
Are There Any Best Hours For Forex Trading?
All the forex markets have the same fixed hours for the operation. Generally, the trading week starts on Sunday at 5 p.m. EST, and it closes on Friday at 5 p.m.
Remember that it is not a frivolous decision to execute trading at any time of the day. Instead, you should go for trading during the time when the market is most active.
Suppose you have seen that more than one forex market is open among four of these markets at a time. Then it shows an elevated trading atmosphere. Therefore, it depicts that there will be more fluctuation in currency pairs during this time.
On the other hand, currency pairs have a tight pip spread when only one market is opened. But if the two markets are open simultaneously, then the pip is usually enhanced, especially if the big news has been released.
Well, that’s all about the article. If you want to make your forex trading profitable, it is worth finding out the best hour for trading. Sometimes it is not the right time to go trading for multiple reasons.
Hence it is essential to know which hours are more suitable for forex trading. And we are optimistic that details regarding the forex hours mentioned in this article will indeed prove helpful.