Let’s say that you have decided to become a forex trader and you have taken all of the necessary steps to learn as much as you can about the market and currency pairs. You have signed up with a fabulous online broker, downloaded MT5, practiced on a demo account, read some books, taken some courses, watched some videos, and gained enough confidence overall to start trading currencies with your hard-earned money. But, wait, there is something else to consider still: you need to decide when you will actually sit down and place your trades.
So Many Possibilities in Forex!
The forex market is open a long time – 24 hours a day, 5 days a week, to be more specific. This means that there are a lot of options for people all over the world who wish to trade currency pairs. Are you a morning person? A night person? Maybe you are super busy, so you need to take a break in the middle of the afternoon to give yourself some free time. Or maybe you only have time in the evening. No matter what your schedule is like, the fact that the forex market is open for so long makes it possible to find the perfect trading window for your needs. But this should not be the only factor that you consider when it comes to when you’ll trade, as there are other things to bear in mind.
Why Are There So Many Options?
Because the forex market involves currencies from all over the world, and markets open and close at different hours because of time zones, there are multiple opportunities to place your trades. Decide which currency pairs you would like to work with, and then see when their markets are most active so you can take advantage of all of the action and hopefully place trades that will yield incredible results.
What Are Some of the Best Times to Trade Forex?
Of course, you can take advantage of the flexibility that is offered by the forex market when it comes to when you can trade, but there are certain times of the day that are considered best for trading, so consider working around those times if it is possible to do so.
Here are some of the best times of the day and night when you should consider trading in the forex market:
When the markets of London and the United States overlap, a lot of trading occurs. This is between the hours of 8 a.m. and 12 p.m. Eastern Time. You can probably imagine all of the activity that happens in these markets, so it is no wonder that it is considered one of the optimal times to trade.
Another way to take advantage of two markets overlapping and being open at the same time is by trading between 3 a.m. and 4 a.m. Eastern Time. This is when the London market and Tokyo market are open and active.
Yet another worthwhile time to trade is between 8 a.m. and 5 p.m. Eastern Time, as this is when the New York market is active, including the stock market. This period of time can be important for anyone who is trading currency pairs that include the U.S. dollar.
If you want to work with the Asian and Australian markets, consider working in forex between the hours of 2 a.m. and 4 a.m. Eastern Time. This is when the markets of Tokyo and Sydney overlap.
So, When Will You Trade?
As you can see, there are a lot of options when it comes to trading times in forex, no matter where you are located. Which time of day or night will you work in?