At the initial stage of trading, many traders ask a relevant question; which day is best for trading forex? Given that the market is operating and awaiting our actions for 24 hours, five days a week. A different currency pair behaves differently at the same time in forex trading. So, when is it better to trade?
In general terms, the daily forex trading cycle can be divided into 4 parts, or rather, 4 trading sessions, depending on the time of forex trading on various exchanges in the world:
- London. Starts from 8 am to 5 pm;
- New York. Begins from 1 pm to 10 pm;
- Sydney. Starts from 10 pm to 7 am;
- Tokyo. It starts from 1 am to 10 am.
*Time is given in GMT 0, i.e., in London.
When is it best to trade forex?
Some currencies perform best at their trading sessions. For example, the yen is more beneficial to trade during the Tokyo session, the American dollar during New York, and the pound, franc, the Euro during London.
The reason for this is straightforward. The primary holders of the currency come into play, right movements begin, liquidity increases, and after it, the forex market volatility.
Now it’s worth talking about how the forex trading week goes. After all, any trader with some trading experience will tell you that every day the forex market is different, market activity, price behavior, and trading signals are different.
Let’s analyze each trading day so that you can get the complete picture.
On Monday, you can observe a relatively calm atmosphere at the market. The reason for this is that, strangely enough, all people have a hard Monday, even for traders. There are no ideas on the further price movement on the market; investment ideas are also absent.
Besides this, there is no important news on Monday either. The exception may be only extraordinary events that occurred on the weekend.
On Tuesday, traders finally pull themselves together and begin to work. This day is the main day in the trading week, as, on this day, the market becomes structured. There is movement and, in most cases, signals to enter the market.
Wednesday and Thursday are the most favorite days for traders. This is because, during these two days, the market sees the best and most significant movements. And since on Tuesday we saw entry signals, on Wednesday and Thursday we get big profits, and someone gets substantial losses.
You can lower your losses by implementing different strategies like stop-loss or take-profit.
By Friday, market activity is noticeably declining. Traders begin to close their positions so as not to leave them on the weekend. Volatility can only be supported by news or statistics coming out by the end of the week.
So, Tuesday, Wednesday, and Thursday are the best days for trading forex. Mondays are stationary, and Fridays are uncertain. By studying different days of the week, you can become an advanced trader.