Forex Trading Times for beginners

If you want to trade the forex market effectively and efficiently, you need to know the best times to trade. Just because the Forex market is open 24 hours a day – 5.5 days a week, doesn’t mean market conditions are always conducive to quality trading. You will find the best Forex trading conditions when the market is moving and volatile, not when it is consolidating and quiet.

Thus, as a trader of the forex market it is critical that you know what the most active Forex trading times are, because this will help you immensely in timing your entries and exits in the market. Price movement provides the best trading environment during the two most active trading sessions; the London and New York trading sessions. The Asian trading session is typically the least active, that’s not to say big moves don’t sometime occur during this session, but they are more likely in the London or New York session.

The Forex market contains three distinct trading sessions; trading starts in Australia and Asia, and moves around the globe into Europe and finally ending the day in North America as trading closes each day in New York. Here are the various Forex sessions and their hours:

• Asian trading session (including Australia and New Zealand): the Asian trading session opens at 6:00pm EST and closes at 4:00am EST

• London trading session: the London trading session opens at 3:00am EST and closes at 12:00pm EST.

• New York trading session: the New York trading session opens at 8:00am EST and closes at 5:00pm EST.

As you can see from the above list of times to trade Forex, there are periods each day where the sessions over-lap each other. It is within these periods when volume and volatility typically rise to peak levels. The best time to trade is typically the over-lap between London and New York; from 8am to 12pm EST. As trading in London comes to an end it is just getting underway in New York, and because these are the two most active trading sessions, the 4-hour over-lap that occurs between them is typically the best time to trade. So, many traders choose to trade during this session over-lap between London and New York because it typically contains the best price action.

Outside of knowing the best Forex trading times, it also helps to know which currency pairs to trade. The “major” Forex pairs are generally considered to be the best pairs to trade, the reason is because they offer the tightest spreads and deepest liquidity. Tighter means you will pay lower fees when trading the majors, and the majors are also better to trade because they move more “logically” than the “exotics” do, on average. Finally, make be certain that you know the best Forex trading times and the best forex currency pairs to trade; these are some of the basics of forex trading that you need to know.