- Trade with Confidence: Obtain Funding Today
- Trade with Confidence: Obtain Funding Today
Why are trading hours in forex important?
Although forex can be traded 24 hours a day, five days a week, trading activity and liquidity vary throughout the day. Here’s a breakdown of the most active trading times for individual currency pairs:
Trading Sessions:
Asian Session (Tokyo Session)
Start: 21:00 GMT (Sydney)
Open: 23:00 GMT (Tokyo)
Close: 08:00 GMT
Overview: This session covers countries such as Japan, Australia, New Zealand, Singapore, and China. It is the first trading session of the day and is known for its activity in pairs involving the Japanese yen (JPY) and Australian dollar (AUD).
European Session (London Session)
Start: 08:00 GMT
Close: 17:00 GMT
Overview: The European session, often referred to as the London session, is one of the most active trading periods. It starts an hour earlier in some European countries like Germany and France. This session sees high activity in pairs involving the euro (EUR), British pound (GBP), and Swiss franc (CHF).
US Session (North American Session)
Start: 13:00 GMT
Close: 22:00 GMT
Overview: The US session, also known as the New York session, overlaps with the end of the European session, leading to increased market activity. It covers the US, Canada, Mexico, and South America. Major currency pairs involving the US dollar (USD) are most active during this time.
Best Times to Trade:
Overlap Between London and New York Sessions (13:00 GMT to 17:00 GMT): This period is known for the highest liquidity and volatility, as both major financial centers are open. It is often the best time to trade, especially for pairs involving the USD, EUR, and GBP.
Asian Session: Good for trading JPY and AUD pairs, but generally has lower liquidity compared to the London and New York sessions.
European Session: Ideal for trading EUR and GBP pairs, as the European markets are open and active.
By considering these trading times and the overlap between sessions, traders can optimize their trading strategies and take advantage of market liquidity and volatility.
Be aware of time zones and time changes
To make matters more complicated, many countries adjust their clocks for daylight saving time in the summer, shifting their trading hours accordingly (e.g., from GMT+2 to GMT+3). Since this change does not occur simultaneously worldwide, it can create confusion among traders. We have detailed the implications of these shifts and the differences between continents in this article.
Additionally, traders outside of Europe should be aware that swaps and rollovers might be based on their local time zone during the current trading day, not at the calendar day’s end, and may need to adjust their trading strategies accordingly.
When to trade?
From the above, it’s clear that while forex trading is possible 24/5, the liquidity of currency pairs varies depending on the market hours and the currencies involved.
The lowest liquidity occurs when the US markets close, leaving only the Asian session active or a few hours before the European markets open. During these times, major macroeconomic reports are less frequent, leading to generally smaller price movements, which may suit some traders.
Conversely, liquidity and price movements are highest during the overlap of trading sessions. The greatest liquidity occurs when the US and European markets are both open, with about 70% of all trading happening during this overlap. This is the ideal time for trading major pairs involving the US dollar or the euro, as significant macroeconomic data is also released.
A notable increase in liquidity is observed during the opening of the European markets, when the Asian and European sessions overlap. Trading pairs with the euro or Japanese yen are favorable during this period. Similarly, there is a surge in volumes during the Tokyo Stock Exchange opening, particularly for pairs with currencies like AUD, NZD, or JPY.
Forex trading offers numerous opportunities throughout the day, but the best times to trade can vary by currency pair. Adjust your strategy accordingly and choose pairs that align with your trading style. Trade safe!
Don't Miss Out, Stay Updated
Register your Email below to receive updates, trading information and offers.
- Follow us
© Vertex Forex Funds. All Rights Reserved.
Risk Disclosure: The content on this site is provided for educational purposes related to financial market trading and is not intended as specific investment advice, recommendations, or financial opportunity analysis. Vertex Forex Funds does not offer investment services. The information on this site is not intended for residents of any country or jurisdiction where its distribution would conflict with local laws. Vertex Forex Funds is not a broker and does not accept deposits. We partner with VertexMarkets as our broker. The trading platform and data feed for Vertex Forex Funds are powered by third-party liquidity providers.
Don't Miss Out, Stay Updated
Register your Email below to receive updates, trading information and offers.
- Follow us