Stock Index Market Hours and The 3 Major Stock Indices Trading Sessions

Tokyo Close Charts

To maximize the number of trading opportunities during these Stock Indices Trading hours, it is important to be aware of the times when the stock indices market is busiest. This is the time that most stock indices transaction activity occurs.

Even though there is no official open and close time during the week, it can be broken up into 3 major Stock Indices Trading sessions - Tokyo, London and New York sessions.

However, although it seems not to be very important at the beginning, the right time to trade is one of the most crucial points required to be a successful investor.

The best time is when the stock indices market is most active and therefore has the biggest volume of transactions. A more active market creates a good chance to make some profit while a calm and slow one is literally a waste of time - turn off your computer and don't even bother trading stock indices at this time.

Not all the times are suitable, that's because the volatility keeps changing. Below is a table outlining the schedule of Stock Indices Trading Sessions. The time used is GMT 0

The 3 major sessions are:

1. Asian Session Hours( Tokyo ): 00:00 - 9:00 GMT
2. European Session Hours( London ): 7:00 - 17:00 GMT
3. U.S. Session Hours( New York ): 13:00 - 22:00 GMT

Best Trading Times

There are hours when two sessions are overlapped:

London + Tokyo overlap - 7:00 - 9:00 GMT

New York + London overlap - 13:00 - 17:00 GMT

At these overlapping market hours you will find the highest volume of stock indices transactions and therefore more chances to win during these hours.

This means that the lion share of stock indices transactions is happening between the London session and US sessions. Naturally this is the best time to make profits.

The stock indices prices moves a lot during the New York and London Sessions because Multinational companies, hedge funds, managed funds and banks are open for transacting.

Multinationals will transact stock indices instruments during this time to facilitate international business transactions and commerce, hedge funds and managed funds will trade stock indices instruments for investment purposes, banks on the other hand will exchange a lot of money on behalf of their clients, maybe tourists wanting to travel around the globe or just anyone wanting to exchange money so as to buy something in another country or make some transaction.

This makes the stock indices market very liquid at this time and the high volume of transactions means that stock indices prices move a lot. At this time the stock index charts will generally move in particular direction and form a short term trend.

As a stock indices trader you also want to join in when everyone is placing their stock indices orders as this is the time there is enough liquidity and many good opportunities to make money, and because there is a lot of liquidity the stock index price movement will generally be more predictable unlike when there is little liquidity and the stock index price movement becomes unpredictable and the stock indices prices can move in a range bound with no particular direction.

Once you trade stock indices trading for a while you will get to know that is easier to make money when the stock indices market is moving up or moving down, unlike when it is in a range.

Asian Session Characteristics:

1. Least volatile of the three sessions
2. Account for 15% of daily transaction turnover
3. Typical 20 -30 pip moves

European Session Characteristics:

1. Most volatile of the three sessions
2. 35% of daily transaction volume
3. Typical 90 -150 pip moves

US Session Characteristics:

1. 2nd most volatile of the three sessions
2. Accounts for 25% of daily turnover
3. Focuses on US economic news

US and Europe Session Overlaps Characteristics:

1. Combines the two most volatile trading sessions
2. Accounts for 60% of total daily transaction turnover
3. Focuses on USA and European economic news
4. Fast moving stock indices prices and stock indices instrument trends in a particular direction
5. Typical 100 -150 pip moves for major stock indices instruments