Trading sessions are particular time intervals when banks of various countries operate and trade actively.
The key feature of trading hours is 24/5 performance of the forex market, excluding national bank holidays. Saturday and Sunday are off days just like in most banks. The unofficial currency market works even on weekends, but making deals during these days is considered risky amid a smaller number of participants and higher chances of short-term changes in a trend. The latter are because one or several large banks of other regions execute client orders.
Currency and stock markets are located in different geographical zones. When one trading session ends, the other one opens and it ensures the 24-hour work of the market.
There are four major trading sessions:
- North American;
Why is it important to know Forex trading hours?
1. If you know trading hours, you can sensibly arrange your schedule.
2. Every trading session has its own peculiarities, considering which you can profit from market possibilities.
3. The trading volume reaches its peak when Forex sessions overlap. During these periods, the most vigorous trading takes place.
Characteristics of trading sessions
The North American session has the highest market volatility. Financial capital New York starts operating at 13:00 UTC when US banks open and European dealers return from lunch. Usually at this time, the most important fundamental news come out and significant data is released. This session is the most aggressive one. The EUR/USD, GBP/USD, USD/CAD, USD/CHF, and GBP/CAD pairs are mainly traded.
The European session opens when activity at the Asian session fades away. The financial center is situated in London. The session and other trading hours overlap because of its geographical position. That is why the London floor has the highest trading volume. The most actively traded pairs are EUR/USD, GBP/USD, EUR/GBP, USD/CHF, GBP/CHF, and GBP/JPY.
The Asian session begins in Tokyo. Trading is moderate. The most popular pairs are USD/JPY, GBP/JPY, and AUD/JPY.
The Pacific session opens right after weekends. It is the calmest session. The financial center is situated in Wellington. Due to its low activity, this session is often combined with the Asian one.
Best forex trading time
During different trading sessions, the same currency pairs may be active or passive. To profit from trading, you should know market trading hours. Being aware of the four major sessions, you can find the best period for trading the currency pairs you choose.
Trading hours can always be at hand as there is a special indicator for trading platforms. The indicator for trading hours graphically shows separate trading sessions. After its installation, changes to DST are performed automatically. Besides, its users receive notifications of session opening and closure. However, this indicator will be of no use for those who trade in 4-hour time frames or open and close at intraday candlesticks.