By Seputar Dunia Forex • Posted in FOREXPEDIA
Throughout 24 hours a day in 5 working days, currency trading in the forex market never stops without taking a break. When gaining momentum, traders take turns in and out of the market to benefit from forex trading . From this point of view, a trader will determine their respective trading schedules according to the conditions that exist in them. However, forex trading times and hours are not always busy, there are even some time sessions where the forex market looks very quiet.
TIME AND HOURS OF ALL SESSIONS ON FOREX MARKET
One of the traders’ strategies in order to get the maximum profit is to determine the best trading time and hours, because not all time sessions in forex trading have a great opportunity to make a profit.
The busier the forex market, the more volatile the price movement of the currency being traded will be, as well as the opportunity to get a profit to be even greater. Thus, traders’ insight into forex trading times and hours is also considered very important to know and understand.
FOREX MARKET TIME
Forex market time is divided into 4 main sessions, namely: Sydney Session (Australia), Tokyo Session (Asia), London Session (Europe), New York Session (America) . It’s no secret that the time difference between Australia and America is quite long, about 16 hours apart. This is why the forex market never stops for a second. When one market session in one country closes, it will be replaced with a market session in another country that is currently open, and so on.
FOREX MARKET OPEN AND CLOSE TIMES
The table of trading time sessions above can be used as a reference as the trading time of each session, except when the United States and several other countries apply Daylight Saving Time (DST) . When there is a DST, trading hours shift forward 1 hour, as well as the schedule of important events or news in the economic calendar. Every year DST is enforced between March and November starting from different dates. So, every forex broker usually makes an announcement when DST will start and end.
The Asian market session is the quietest market among other market sessions, accounting for only 20% of all world forex trading, including the Tokyo session and the Sydney session. Where the center of the Asian market is Tokyo reaching 8%, Singapore reaching 5%, Hong Kong reaching 4%, and Australia reaching 3%. The characteristics of the Asian market are as follows:
In addition to Japan, there are other countries that have considerable economic power, namely Hong Kong, Singapore, Australia, and Korea are also actively involved in conducting currency trading transactions. Among the countries that are the most active as major exporters are China and Japan, thus making export/import commercial entrepreneurs also actively participate in currency trading activities, apart from the Central Bank which is active in the Asian market session.
At certain times, the availability of funds or liquidity may turn out to be low. This can be seen in very small price movements and lasts for a relatively long time, giving rise to a consolidation phase of price movements in currency pairs.
Most prices move early in the session, when fundamental economic events or news are released.
The Tokyo market session usually has an impact on the next trading session, because European and American traders will usually analyze price movements in the Asian market session first before deciding on a trading plan for that day.
Interesting currencies to trade in this Asian session are the JPY and AUD. However, you still need to be careful, considering that China has become a new economic power in Asia, so when China releases economic events or news that occurs, it will also affect price movements in the JPY and AUD currencies.
Europe has the largest share of currency trading accounting for about 36% of trading in the world forex market. In the UK about 31% while the remaining 5% are in Germany. This European market session is the busiest market than other market sessions, where world class traders and companies trade in this market session. The characteristics of the European market session are as follows:
The London session is a very lively forex trading session. This is what causes market liquidity to turn out to be very high and spreads to become smaller.
The occurrence of high price volatility or the range of price movements turning higher.
During the day in the European market session, price movements tend to decrease along with the European lunch time while waiting for the American market to open.
Some important events and news in the European region will usually greatly affect price movements.
Currency pairs that attract attention to trade in this European time session are major pairs such as EUR/USD, GBP/USD, USD/JPY, and USD/CHF and there are also several cross pairs, namely EUR/JPY and GBP/JPY .
America, which has a trading and business center in New York, accounts for around 19% of the total global currency trade. New York as America’s business center is now not only America’s financial center, but also the world’s financial center. Therefore, about 90% of global trade uses US Dollars as the medium of payment. This American market session is also important for traders to find the right momentum in opening forex trading transactions. The characteristics of the American market session are as follows:
- At the beginning of the American market session, liquidity tends to be high due to overlap with the European market.
- When news and economic events in the United States are released, it will have a very large effect on currency price movements, because 90% of all world trade involves the US Dollar.
- When the European market is down, the volatility and liquidity of the American market tends to weaken, in line with the afternoon of the American trading session.
- Like the European market, in the American trading session all currency pairs are also very interesting to trade. However, you should be careful when news and world economic events will be and are being released. Because the price movement of the US Dollar can suddenly change, even the movement can be very wild.
Thus the explanation of the time and hour for forex trading. From all the reviews above, of course, it can be used as a reference when the time and hour is right for you to execute orders in forex trading transactions, of course by adjusting your trading conditions and style.