Wednesday 12 June 2013

Forex Market Trading Hours

Forex market has an advantage over the stock market – it operates 24/6; whereas the stock and commodities market operates 24/5 (Monday through Friday) normal business hours. Forex market continues its activity around the clock. If you want to trade at 2:00 am EST Monday morning, feel free to place your trade. If you would like to invest at 9:00 pm Thursday night or whenever you have the time to trade just place your trade. However, even though the market is considered a 24-hour market, it's important to know when the market is actually active and when is the best time to place a trade on the market.
Actual operating hours:
Forex market is open 24 hours a day, each financial centre (i.e. New York, London, Frankfort, Tokyo, and Australia) has its own operating hours, which are usually from 8:00 am - 4:00 pm, local time. That means if it's 8:00 am (Tokyo time) on Monday morning, the Tokyo market will be open for trading even though it's 10:00 pm EST, on Sunday night. You could therefore take advantage of trading on the Forex market late Sunday night from New York.
Overlapping of hours:
In forex market there is time when two or more markets overlap. For instance, the New York and London markets overlap from 8:00 am to 12:00 pm EST, while the London and Tokyo markets overlap from 3:00 am to 4:00 am EST. The Sydney and Tokyo markets also overlap from 7:00 pm - 2:00 am EST. These overlapping periods are the best time to trade since volume (liquidity) is at its greatest.
Other good times to trade:
Besides the overlapping periods, it's best to trade at the following times:
·         During the middle of the week (shows most movement)
·         During trading hours of the three largest markets - London, New York, and Tokyo.
Times to avoid:
It's best to avoid the following times/days:
·         Sundays (limited volume)
·         Fridays (unpredictable)
·         Holidays (limited volume)
·         Release of economic reports (volatility)

·         4:00 pm - 6:00 pm EST (low market volume).

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