How to find and trade the most volatile hours of the market?
Forex Market Hours
The Forex market starts with the Sydney session at 5:00 PM EST in Sydney, Australia, while some traders in New Zealand will start trading an hour earlier at their 4:00 PM time. Wellington shuts down at midnight, whereas Sydney stops operating at 1:00 AM.
Forex trading in Sydney opens at 5:00 PM EST during the whole week, the same time as the New York Session’s 5:00 PM EST closes the next day., when the market in New York closes on Monday at 5:00 PM, the market in Sydney starts operating on Tuesday morning in its time zone.
Two hours after the work starts in Sydney, the Forex market opens in Tokyo at 7:00 PM EST and shuts down at 4:00 AM. At the same time, Singapore and Hong Kong start their session two hours after Tokyo at 9:00 PM and then closes at 5:00 AM. It is incredible to know that when the London Session opens while the Asian (Tokyo) session shuts down creates one of the busiest forex trading times.
Frankfurt opens at 2:00 AM in the European session and closes at 10:00 AM, while the prime London forex trading session starts at 3:00 AM and shuts at 11:00 AM.
East Coast North American markets operate in New York at 8:00 AM and close at 5:00 PM. Chicago trading opens one hour later, and California traded three hours later.
Thus, the Forex trading time rotates throughout the week, and the forex market trades till Friday afternoon, when New York Session closes and starts operating when Sydney opens at 5 PM, Sunday.
The European-North American Overlap occurs from 8:00 AM to 11:00 AM
This overlap is the crucial Forex trading period when both the New York and London major forex trading centres are open for their business. Trading in all the European currencies is massive during this period and provides the most liquidity for currency pairs, including the Euro, Pound Sterling, and Swiss Franc.
The Asian European Overlap occurs at12:00 midnight to 3:00 AM
Sydney shuts down at 1:00 AM, whereas Tokyo, Hong Kong, and Singapore stay open, overlapping with Frankfurt and London at 2:00 AM and 3:00 AM, correspondingly. This time often provides the most liquidity for the Japanese Yen, and the European Yen crosses.
Another good time to trade to take advantage of numerous markets being open simultaneously is between 1:00 PM and 3:00 AM because, at this time, Asian and European markets overlap at different points.
The Tokyo, Singapore, and Hong Kong Forex markets keep trading throughout this overlapping period. The Frankfurt and London markets then open at 2:00 AM and 3:00 AM, and when they overlap with Singapore and Hong Kong sessions until 5:00 AM. This period is predominantly active in trading the USD/JPY, EUR/JPY, GBP/JPY, and CHF/JPY currency pairs.
Conclusion
It is important to benefit from the market overlaps and keep an eagle eye on news releases when scheduling the trade. Traders who want to increase profits should aim to trade during more volatile periods while monitoring the data.
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