Many beginner Forex traders make rash decisions when it comes to trading. They monitor significant economic calendars and trade aggressively on every data release, viewing the 24-hour, five-day-a-week foreign currency market as a convenient way to trade all day.
This technique may swiftly destroy a trader’s savings, as well as burn out even the most tenacious trader. Unlike Wall Street, which operates during regular business hours, the FX market operates throughout the regular business hours of four distinct areas of the world and their corresponding time zones, allowing trading to occur at all hours of the day and night.
New York opens at 8:00 a.m. and closes at 5:00 p.m. EST for forex trading (EDT)
Tokyo is open from 7:00 p.m. to 4:00 a.m. (EST) (EDT)
Sydney is open from 5:00 p.m. until 2:00 a.m. (EDT)
London is open from 3:00 a.m. to 12:00 p.m. EST (EDT)
Overlapping Trading Times in the Forex Market:
Research about Best Time to Trade Forex is when the open markets’ trading periods overlap. Overlaps result in more significant price ranges, which means more chances.
Forex is a global network of exchanges and traders. When each participating country’s exchange is open, trading hours are set. Understanding when each primary market is open is the first step in choosing the optimal time trade exchange. There are four key markets to consider. Here’s a closer look at the three overlapping occurrences that occur every day:
• US/London (8 a.m to afternoon): The U.S./London markets have the most overlap. According to Lien, more than 70% of all deals occur when these markets collide since the US dollar and the euro (EUR) are the two most popular currencies to trade. Because volatility (or price activity) is high, this is the best moment to trade.
• Sydney/Tokyo (between 2 and 4 a.m.): While not as volatile as the US/London overlap, this time offers traders the option to trade during a time when pip volatility is more incredible. Because these are the two most affected currencies, EUR/JPY is the best currency pair to strive for.
• London/Tokyo (3 a.m to 4 a.m): Because of the timing (most U.S.-based traders will not be awake at this time) and the one-hour overlap, this overlap sees the least amount of action of the three.
Laila Azzahra is a professional writer and blogger that loves to write about technology, business, entertainment, science, and health.