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What is The Best Time to Trade Forex Currencies?

Timing is one thing that will determine your success in the Foreign exchange market and that is why it is essential to find the best time to trade Forex the best time with regards to activity and volume of currency transactions. This is what we call volatility, when the currency market is volatile it is more liquid.

 

When is the best time to trade Forex? The most prominent time is undoubtedly the US and the UK sessions, accounting for more than half of the total Forex transactions.

 

If it comes to major sessions; London, New York and Tokyo take up 75% of market activities. And transactions volume is the heaviest when the major markets sessions overlap, this is the best time to trade.

 

Forex sessions overlaps are characterized by high liquidity and the probability of finding a profitable trade is very high. This is because the volume of transactions is determined by the number of markets that are open and the times during which they overlap with each other.

 

Best Time to Trade Forex Based Upon Volume and Activity

The best time is when markets sessions overlap this is the time when markets are highly liquid because there are more participants, which means more volume and momentum to fuel currency trends and trend breakouts. This also tends to be when economic data is released, providing the triggers for the movements in currencies.

 

European and U.S. Market Overlap: 13:00 - 17:00 GMT

The currency market is the most active when the two largest trading centers in the world overlap. 80 percent of the total average usually occurs during U.S. and European hours. Just these percentages alone tell day traders that they cannot sit in front of the screen all day; this time alone is enough to make a good profit, the best time - the U.S. and European overlap which is between 13:00 and 17:00 GMT.

 

Asian and European Market Overlap: 7:00 - 9:00 GMT

The next best time to transaction Forex is during the Tokyo and European Session overlap when both the Asian and European traders have the opportunity to respond to European economic data. The London open is also volatile as European traders normally react to overnight developments.

 

These times when the sessions overlap is the time you have to target to make profits, it is the best time for transacting on the currency markets.


THE ABSOLUTE BEST TIME FOR FOREX TRADING IS FROM 7:00 TO 17:00 GMT.

The best time for currency trading is 7:00 to 17:00 GMT, this is because the volatility is much higher and opportunities for making a profit are much more frequent with bigger moves, especially in these 10 hours. This is when you can make 50-80 pips Profit.

 

The Forex currency pairs that move the most during these market hours are:

  • EURUSD

  • GBPUSD

  • USDCHF

  • USDJPY

 

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EUR/USD

During the Tokyo session, the Euro takes 15% of all volume so it is best to start watching the Euro late in the Tokyo session. It transacts 39% of all volume during the London session. It can also be traded during the New York session.

 

GBP/USD

The pound transactions are extremely light during the Tokyo session. Start watching it near the end of the Tokyo session as it can start moving then. In the London session, GBP/USD accounts for approximately 23% of all transactions volume. The Pound can be traded in the New York session also.

 

USD/JPY

During the Tokyo session, USD/JPY accounts for approximately 78% of all Forex volume. This drops to about 17% during the London session. There are occasional days when these 3 pairs make significant price moves outside the sessions which normally have the most transactions volume.



News Releases / Economic Data Releases
23:50 GMT Japan Fundamentals
07:45 GMT Euro Fundamentals
13:30 GMT USA Economic Figures

During Summer Time these news release times are 1 hour earlier because of day light saving hour.


Best Days

Although the online currency exchange market is open on all these 5 business days there are certain days which are considered as the best days and trading during these days will give you the best time.

 

If you want the best time and the best days to trade, then statistics shows that Tuesday, Wednesday and Thursday are the best days since the maximum number of Currency transaction happen during these weekdays.

Forex Market Sentiment

The EURUSD is at a major support level, Open an account and start trading EURUSD which is oversold and at a major support level: Read The Article "Support and Resistance levels"

Another reason to start being bullish on the EURUSD and EURJPY is Risk Appetite vs The Risk Averse sentiment used when trading high yielding currencies vs the US Dollar and the Japanese Yen when world economies start reporting data that is supporting economic growth: Read The Article "Risk Appetite vs The Risk Averse"


Eurozone Economic Growth Gains Momentum in November - Eurozone economic growth accelerated to its fastest pace and was at an all-time high, order books grew and factories were prompted to add more workers and raise the prices of their goods as the economic environment in Europe grew the fastest as shown by economic data – November Composite PMI for manufacturing and services grew to the strongest in 18 months and was at an all-time high of 54.1, up from 53.3 in October. There are two PMI data reports - one for manufacturing and the other one for services. The PMI for manufacturing was at an all-time high of 34 months and rose to 53.7 in November while that of services rose to an all-time 11 months high of 54.1; Marking a strong expansion in economic growth and signaling that the recovery in Europe is continuing to gather momentum thanks to the €1.7 trillion quantitative-easing program being carried out by ECB in Europe. IHS Markit has said that companies are on boarding new staff at the fastest pace ever since 2008, as the prices of goods increased the most in five years as companies continued to pass the production cost to their consumers – the November PMI showed the steepest monthly increase in business activity with plenty of signs that the economic growth will continue to accelerate as the inflation in Europe continues to intensify steadily. Open an account and start trading EURUSD and EURJPY today.


Major Market Mover - Non Farm Payrolls on Friday: Open an Account Today and Trade NFP on Friday

First OPEC Deal on Oil production cut in 8 years fuels more risk appetite: Open an Account Today - Don't Miss Out on the trades


Read The Articles: Eurozone Economic Growth Gains Momentum in November - Fueling Risk Appetite in FX trading


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