Forex trading time
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 the value of a currency to rise, you buy it, and if you expect the value of the currency to fall, you sell it.
When can you trade Forex?
One of the key aspects of successful Forex trading is understanding trading timing. Forex trading timing affects 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 calmest. It runs from 0:00 to 9:00 GMT
- The European session is known for its increased volatility and trading volume. Lasts from 8:00 to 18:00 GMT
- The North American session is often characterized by significant market movements. Starts at 13:00 ends at 23:00 GMT
When determining which trading session is currently being traded, do not forget that in the summer the time shifts an hour earlier.
The session indicator for MT5 will help you determine which session you are trading - https://time-forex.com/indikators/indikator-sessiy-mt5
Knowing when these sessions open and close helps traders determine the most appropriate times to enter and exit the market, and plan their trading strategies according to the expected level of activity.
During cross-trading times, such as when the European session is almost ending and the North American session is just beginning, the market can be especially volatile, providing traders with high profit opportunities.
However, this same time can increase risks, so additional caution is required when opening transactions and strict control over risks.
The Impact of Trading Timing on Strategies and Results
Forex trading is a dynamic process where time is of the essence. That is why adapting trading strategies for different trading sessions is an important aspect that every trader should take into account.
Different trading sessions, such as Asian, European and American, are characterized by their own characteristics. For example, the Asian session may see lower volatility, while the European and American sessions often bring significant movements in the market.
Traders should adapt their strategies by taking into account points such as:
- Economic news release time - https://time-forex.com/kalendar
- Increased liquidity during cross-session periods.
- Changing the spread size depending on the trading session
- Specific currency pairs that are most active during a particular session.
For example, if you are trading the EURUSD currency pair and using a news strategy for trading, then there is no point in trading during the Asian session, since at this time there is unlikely to be news that affects the European currency or the US dollar.