Once you decide to enter the world of Forex trading, you will find that FX trading has many advantages over other capital markets. Among others; very low margins, free trading platforms, high leverage, and around-the-clock trading.
My main concern in this article is to let you know at what hours you should be ready and focused to start trading so that you can expect the highest profits on your trades and not just think that trading around the clock means that you should trade randomly throughout the day.
In short, it is important to know what the best hours to trade are because if you want to find a considerable number of profitable trades, you need to enter the forex market in the best timeframe, that is, when the activity, the volume of trades is the highest.
At any given time; anywhere in the world someone is buying and selling currencies. When one market closes, another market opens. Business hours overlap and change continue as day turns to night and night to day. Giving you a full 5.5 potential trading days.
Forex Trading starts at 17:00 EST on Sunday in New Zealand and then Australia, Asia, the Middle East, Europe, and America in that order and continues throughout the day and week until 16:00 EST on Friday when the American market closes.
Other important facts that every Forex trader should know are the following: The US and UK markets account for more than 50% of forex market trades; Forex’s main markets: are London, New York, and Tokyo. About two-thirds of NY activity takes place in the morning hours when European markets are open. And perhaps one of the most important characteristics; Forex Trading activity is heaviest when the major markets coincide.
So, the answer to the question; “What hours should I trade?” is determined by this last characteristic, you should trade when the major markets coincide. Now, when do they coincide?
Considering the different time zones of the world and the opening and closing times for the Australian, New Zealand, Japanese, American and European markets. We can conclude that there are two major time gaps where two major markets overlap during trading hours.
These are from 2 am to 4 am EST (Asia/Europe) and from 8 am to 12 noon EST (Europe/America).
So if you want to catch the best trading opportunities of the day and you are in the Americas, you should be ready to wake up early or go to bed late at times. Of course, things are different around the world. Where is the best region to trade if you can’t get up early?…. Maybe Ukraine.