Forex trading hours
Forex, also known as the foreign exchange market, is the largest and most liquid market in the world, with over $7 trillion worth of currencies exchanged daily.
Traders analyze economic indicators, political events, and a number of other factors to make an informed decision about buying or selling a currency.
The basic principle of Forex trading is that if you expect a currency to rise in value, you buy it, and if you expect a currency to fall, you sell it.
When can you trade on Forex?
One of the key aspects of successful Forex trading is understanding trading hours. Forex trading hours affect market volatility and liquidity.
As for holidays when Forex is closed, we discussed them in this article - https://time-forex.com/info/vyhodnye-prazniki-forex
Depending on the time of day, trading takes place on a specific exchange, forming a trading session – Asian, European, and North American.
Each session has its own characteristics:
- The Asian session is usually the quietest. It runs from 0:00 to 9:00 GMT.
- The European session is known for its increased volatility and trading volume. It runs from 8:00 AM to 6:00 PM GMT.
- The North American session is often characterized by significant market movements. It starts at 1:00 PM and ends at 11:00 PM GMT.
When determining which trading session is currently being traded, remember that in the summer, the time shifts an hour earlier.
The session indicator for MT5 will help you determine which session you are trading on - https://time-forex.com/indikators/indikator-sessiy-mt5
Knowing when these sessions open and close helps traders determine the best times to enter and exit the market and plan their trading strategies according to the expected level of activity.
During trading session overlaps, such as when the European session is almost over and the North American session is just beginning, the market can be particularly volatile, providing traders with significant opportunities to make money.
However, this time can also increase risks, so extra caution is required when opening trades and strict risk management.
The Impact of Trading Time on Strategies and Results
Forex trading is a dynamic process where timing is crucial. Therefore, adapting trading strategies to different trading sessions is an important aspect that every trader should consider.
Different trading sessions, such as the Asian, European, and American sessions, each have their own characteristics. For example, the Asian session may experience lower volatility, while the European and American sessions often see significant market movements.
Traders must adapt their strategies taking into account factors such as:
- Economic news release times - https://time-forex.com/kalendar
- Increased liquidity during overlapping sessions.
- Changing the spread size depending on the trading session
- Specific currency pairs that are most active during a particular session.
For example, if you trade the EURUSD currency pair and use a news trading strategy, there's no point in trading during the Asian session, as it's unlikely that news will be released at that time that affects the European currency or the US dollar.
