Many first forex traders hit the race market. Looking at the various economic calendars and doing business with every single data release, they see the 24-hour-a-day exchange, five days a week as an easy way to do business all day. Not only can this strategy eliminate the merchant’s savings quickly, but it can burn even the most progressive trader. Unlike Wall Street, which operates on regular trading hours, the forex market runs on regular trading hours of the four different parts of the world and their time zones, which means that trading takes day and night.
So what’s the alternative to staying awake all night? If traders can understand the market hours and set the right goals, they will have a better chance of realizing the benefits within a feasible schedule.
Forex Trading Hours
First, here’s a brief overview of the four markets (hours in the Middle East Hour, or EST):
- New York (open 8 am to 5 pm): New York is the world’s second largest forum, viewed by foreign investors because the US dollar participates in 90% of all businesses, according to Marketing. ”(2005) by Kathy Lien. Movements in the New York Stock Exchange (NYSE) can have immediate and strong impact on the dollar. When companies merge, and the purchase is completed, the dollar can immediately gain or lose value.
- Tokyo (open 7 p.m. to 4 a.m.): Tokyo, Asia’s first trading center to open, occupies a significant proportion of Asia’s business, just ahead of Hong Kong and Singapore. Currency pairs that typically have the same rate of action are dollars / JPY, GBP / CHF, and GBP / JPY. USD / JPY is a good pair to watch while the Tokyo market is the only one open, because of the heavy influence Bank of Japan is on the market.
- Sydney (open 5 p.m. to 2 a.m.): Sydney is the official business day. While it is the smallest of the mega markets, it sees many early stages when markets reopen Sunday afternoon because traders and financial institutions are trying to reorganize themselves after a long time since Friday afternoon.
- London (open 3 a.m. to noon): U.K. it dominates the global currency markets, and London is their prime location. London, the capital of world trade, accounts for 34% of global trade, according to an IFS London report. The city is also having a significant impact on currency fluctuations because the Bank of England, which sets interest rates and controls the GBP’s monetary policy, has its headquarters in London. Forex trends often originate in London as well, which is a good thing for technical traders to keep in mind.
Best Hours of Forex Trading.The currency trade is unique because of its working hours. The week starts at 6 p.m. EST Sunday and runs until 5 p.m. Friday.
Not all hours of the day are right for business. The best time to trade is when the market is more active. When more than one of the four markets is opened at the same time, there will be an elevated trading situation, which means there will be more fluctuations in currency pairs.
When only one market is open, a pair of currencies is usually closed at a spreading speed of approximately 30 pips of movement. The two markets opening at once can see movement north of 70 pips, especially when big news is released.
Exchanges in Forex Trading Times
The best time for business is the time to interact in business times between open markets. It overlaps equally with high-priced ranges, resulting in more opportunities. Here is a closer look at the three daily interactions that occur:
- U.S./London (8 a.m. to noon): The heaviest in the markets takes place in U.S./London markets. More than 70% of all trades occur when these markets overlap because the US dollar and the euro are the two most popular currencies to trade, according to Lien. This is the best time to trade as the volatility is high.
- Sydney / Tokyo (2 a.m. to 4 a.m.): This time is not as dangerous as the U.S./ London floods, but it still offers a chance to do business in the era of high-end pipeline dropouts. EUR / JPY is the best target currency pair, since these are the two main currencies.
- London / Tokyo. an opportunity to watch the major pipe changes occur.
- Effects of Information Release on Forex Marketing
- While understanding the markets and their interactions can assist a businessman in planning his business, there is one influence that should not be overlooked: the release of information.
Big news has the power to extend the normal business period slowly. When a big announcement is made about economic data – especially when it goes against a forecast – the currency may lose or gain value in a matter of seconds.
Even though most economic releases take place every day of the week in all time zones and affect all currencies, a trader does not need to be aware of all. It is important to prioritize the release of information between those that need to be viewed against those that should be monitored.
Examples of important information include:
- Determination of interest rate
- CPI data
- Commercial limitations
- Consumer Use
- Central bank meetings
- User confidence
- GDP data
- Unemployment rates
- Retail sale
Bottom Line. It is important to take advantage of market interaction and keep an eye on the information when planning a business. Businesses looking to maximize profits should focus on trading during the most transformative times when looking at the release of new economic data. This balance allows full-time and full-time traders to set a schedule that gives them peace of mind, knowing that opportunities are limited when they give their eyes to the markets or need to get a few hours of sleep.