Best Time For Forex Trading

Once we know what Forex trading is and who plays it ... it's time we learn when is the right time to trade. One point we should not miss!

Previously it has been mentioned that Forex is a market that is open 24 hours. But that does not mean we have to keep our buttocks in the chair and glare at the computer screen for 24 hours, just in case the market moves will threaten us. Not like that.

We can turn off the computer and go to bed, because whatever happens to the market, we can make a profit from it. Whether the market moves up, or when it slumps. New problems will come if the market does not move at all.

We already know from the previous material that forex ditradingkan 24 hours a day. But actually 24 hours is divided into four trading sessions:

Sidney Sessions

Tokyo session

London Session

New York session

Below is a table of open and close hours of each trading session in Summer (around April-October)

While below are the opening and closing hours of each trading session in Winter (around October-April)

The opening and closing times of each session are actually based on local business hours. Therefore, there will be times when the clock shifts one hour, as some countries move from / to daylight savings time (DST). The change of time of each country may differ.

From the two tables above, it is seen that between each session there is one period of opening time of the same trading session. In the summer, from 3:00 to 4:00 EDT (15:00 to 16:00 GMT + 7), Tokyo and London sessions overlap, and during summer and winter from 8:00 AM-12: 00 PM ET (20: 00-24: 00 GMT + 7), London and New York Sessions overlap.

In those overlapping hours the market has the highest trading activity, because the volume at the time when the two markets open at the same time is greater than the others. Because at this hour all market participants are busy doing the selling or buying. In other words, it is a moment in which money flows faster than one hand to the other. About this overlap we will explore again in the next material.

If you look at the opening hours of the Sidney market on both tables, we will find the opening hours of the Sidney session over two hours accelerated. Well, the question now is why it should be two hours instead of an hour, if the US can adjust its trading hours? There are things we need to keep in mind about this time change. When the US turns an hour, it means that Sidney clock is accelerated by an hour. Although both have four seasons, but the movement is different between America and Australia.

Well, let's take a look at the average pips movement of the major currencies of each pair of trading sessions:

From the table above we can see that the European session presents the most movement. Let's observe the pip movement of each session, so we can make better use of trading time!

Tokyo Trading Sessions

In addition to being known as the Asian tiger because of its economic progress, in the Japanese trading world is also known as the third largest Forex trading center in the world. The Japanese Yen is also the third most commonly used currency by traders, taking up 16.50% of all Forex transactions worldwide. Meanwhile, about 21% of Forex transactions in the world occurred in this session. Read more

London Trading Sessions

As Asian market players begin to tidy up their goods and close, European market participants have just started their activities. Although there are several financial centers in Europe, but the views of market participants will be on London. Read more

New York Trading Sessions

After lunch, or when we (Indonesians) are gathering with the family, the US session starts at 8:00 am (EST) or 8:00 pm (GMT + 7). Like the Asian and European sessions, the US trading session is one of the world's financial centers and is always monitored by the market. Read more

Overlap Between Sessions

Overlap between sessions occurs when two sessions are equally operating. Many market players make deals at those times. If likened, this moment is like prime time (primetime) on TV. The more "viewers" (actors involved in the session), the higher the "rating" (liquidity) of the event. Read more

Good Day For Trading

From the previous material, we know that the London session is the busiest trading session of the day. However, there are also certain days of the week in which markets tend to be more active. Read more

Every trader should know whenever time and day is good for trading, and whenever trading is better not done. This can be very helpful in earning profit and avoid loss, so keep in mind:

1. Good time to trade:

When there is an overlap between two sessions, which causes high volatility and liquidity. If you can not remember the trading session, we can bookmark this page.

Among the four existing sessions, London is the session with the most deals.

Mid-week are the days with the highest movement frequency, because the range of movements tends to widen in these days (Tuesday, Wednesday, Thursday).

2. Less good time for trading:

Sunday, because this is the time we relax and enjoy the holidays.

Friday, as liquidity dropped sharply leaving the United States session.

International holiday, because ... yes, people also vacation.

The news release had a big impact, because it was too risky. Well ... unless we want massive loss too.

"Oh shit, I'm too busy from Tuesday to Thursday!"

Relax, my friend. Do not be afraid of not being able to trade because it's busy on good days. Remember the old saying, no rattan root so. Well ... we do not need to be rattan, just change our trading style to be a swing trader. For the way, we will learn in the next material.