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Understanding the Forex Trading Hours

Updated on December 31, 2014
Forex trading shifts from one continent to a another in a 24 hour session.
Forex trading shifts from one continent to a another in a 24 hour session. | Source

Introduction.

Currency trading is a lucrative exchange markets in the world. With a 24 hour trading sessions daily, in exceptions of weekends, there are well over five trillion dollars worth of transactions are carried out. The best opportunities to realize significant profits are when two trading sessions overlap . Ask George Solos, the Guru in Forex trades; you will hardly succeed in Forex trading without knowing which session is active when. Understanding the Forex trading hours is key.

A trading session begins in Sydney at 2200Hours GMT and comes to a close in New York 24 hours later. In between, Tokyo and Sydney come to live. Your chance to benefit from price fluctuations is tied to which center is active when and which currencies have the greatest price movements. So which times are the best for Forex trading?

Trading sessions overlap over the course of the 24 Hour session. In addition, different currencies have the greatest price fluctuations in specific trading hours. Here is a preview of leading Forex centers and their hours of operation;

New York Trading Session starts at 1300 GMT.
New York Trading Session starts at 1300 GMT. | Source

American session

THe American session opens in New York at 1300Hrs GMT and remains active through to 2200Hrs GMT. Since there is a four hour overlap between New York session and that of London, Forex market is highly volatile at this time. Based on the size and diversity of the two markets, many currency pairs are traded successfully during this overlap. However, the ember dies off at 1700Hrs GMT when the London Forex center draws to a close.

European session

The European kicks off at 0800 Hours GMT. Owing to a one hour overlap between the Tokyo and London sessions, the market remains active till the Tokyo Forex closes down. You can bet there are massive transactions and minimum currency value fluctuations. As such, chances are good to make a few pips from setting up transactions.

Asian Session


Just as the European market is coming to live, the Tokyo session is closing after an eight Hour trading session. The Tokyo session opens up at 0000 Hours GMT. It is characterized by massive transactions on Asian paired currencies Yen-the third most traded currency- dominating transactions. The Asian session attracts commercial entities and the Central bank. Price movements can be caused by release of economic data.

Sydney has rose to be an important Forex trading center.
Sydney has rose to be an important Forex trading center. | Source

Sydney

The Australian center comes to live after the American session has come to a close at 2200 GMT. It’s in operation for two hours before the Tokyo opens its doors to Forex traders. It marks the beginning of a day Forex trading session. Though small in size,it is hyperactive on its Sunday afternoon session. This, perhaps, is due to inactivity over the weekend. Chances are, you can make some pips in the opening hours in the Sydney trading session and back out as the trading progresses on.

Video Resources explaining Forex Trading Sessions.

Singapore

Singapore accounts for up to six percentage of all Forex transactions. Indeed, Singapore might just be new Asian Forex trading lead center in future. The Forex trading hours in Singapore are during the Asian session.

Recommendation.

Success in Forex trading is heavily pegged on choosing to trade in the right time. Your understanding and subsequent timing on factors that influence trading, such as press releases and economic briefing is paramount. Trading sessions in which there is an overlap such as those of New York and London present a big opportunity to cash in on the price fluctuation.

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