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When is the best time to trade forex ?

When is the best time to trade forex ?

 

The foreign exchange market is open 24 hours a day 5 days a week, this enables investors to trade whenever they want.

However there are times when price action is consistently volatile and periods when it is muted. 

We need to decide what is the best time for us to trade depending on our strategy and what are the currencies we should trade at this time.

 The market is separated into 3 sessions

1: The Asian  (Tokyo). 11 p.m and 8 a.m GMT

2: The European  (London).  7 a.m. to 4 p.m. GMT.

3: The north American (New York).   noon to 8 p.m.

 The markets are most active when these three powerhouses are conducting business, if the pair is a cross made of currencies that are actively traded during Asian and European hours like EUR /JPY and GBP/JPY there will be a greater response to the Asian/ European sessions and less dramatic increase in price action during the European /US sessions

The best time to trade the EUR/USD pair is when the European/US session crossover happens.

Which pairs are best to trade ?

1: The Asian session

It is more likely that you will see stronger moves in Asia Pacific currency pairs like Yen pairs AUD/USD and NZD/USD.

2: The European session

There is so much liquidity during the European session so almost any pair can be traded during this session.

The best pairs are : EUR/USD, GBP/USD, USD/JPY and USD/CHF.

3: The American session

 Most economic reports are released near the start of the New York session so all pairs can be traded, all major and minor pairs.

So what is the best time to trade?

The best time to trade is at London – New York overlap 12:00- 16:00 GMT

During this times we can see the big moves, especially when news reports from the US and Canada are released. 

What is the best days to trade ?

The best days to trade are in the Middle of the week Tuesday Wednesday and Thursday, Since this is when most of the action happens 

 it would probably be best to trade during the middle of the week, since this is when the most action happens.

Friday is usually a good day to trade till Noon  

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