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Forex Trading Hours

 

Although it is often touted that the Forex markets never sleep, you really should not be trading at all hours.

Technically, trading hours start on Monday morning in Sydney, Australia and continues on through Friday afternoon in New York. The markets therefore are closed on the weekends, which is a really good time to take a break! It is true that there is usually a market open at some location during the week hours, but can you really trade all the time?

The international time-zones come into play, when you decide the best times to trade. One common method used by traders, is to state all times in UTC, which is Universal Coordinated Time, (also Greenwich Mean Time), which coincides with the time-zone of London UK during winter.

Therefore, trading hours are stated as 22.00 Sunday UTC to 22.00 Friday UTC. The east coast of USA (New York) runs 5 hours behind the UK. To state the Forex hours for Americans, the markets open and closes at 5 pm Sunday and Friday in New York, which equates to 2 pm on the US west coast.

So far the concept of Forex trading hours is simple. Next we need to take into consideration the seasons, which vary in the Northern vs Southern hemispheres. Many locations have daylight savings hours during winter, which can change the time by one hour. Another aspect is the length of our seasons. Some countries such as Australia measure summer months from September to March while most Northern countries usually have summer of March to September.

To summarize, these are the typical trading hours;

Sydney: 10 pm to 7 am UTC
Tokyo: 12 midnight to 9 am UTC
London: 8 am to 5 pm UTC
New York: 1 pm to 10 pm UTC

Because the USD is a dominant currency, the American hours can influence the trading of other counties during the USA trading hours. The late afternoons in New York (after 3:00PM) are often slack, and therefore not optimal for trading. Also any market can be more risky with additional volatility near the start of the day, so exercise additional caution at those times, or wait to trade when things settle down.

Brokers and salespeople will promote that markets can be traded 24 hours a day, and you can even make money while you sleep, but in reality you really can’t trade at any random time. Your odds of success increase when there is liquidity.

Once you have decided which currencies you want to trade, you should carefully study the charts to determine the best trading hours for those pairs. You can easily notice the times when your chrts seems to stall out, with low momentum and poor trading opportunities.

Additional Resources;
World Time Zone Online.
Forex Market Hours.
The best time to trade Forex.

Topics: Forex, Fundamental Analysis | Comments Off

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