What Is the Best Time for Trading Forex? (2024)

The foreign exchange market is a global decentralised market, which means that it is open 24 hours a day in different parts of the world. Most traders agree that the best times to trade the forex market are when the market is most active, which is often when the trading hours of major regions overlap. In this article, we share what the four major forex centres in the world are, their opening times and the best time to trade forex in the UK.

The 4 Major Forex Markets

Within the global market, the four major forex exchange markets are in London, New York, Sydney and Tokyo.

London Market Hours: 8:00 am - 4:30 pm (GMT)

The London Stock Exchangeis open from Monday through Friday between the hours of 8 am to noon and from 12:02 to 4:30 pm GMT. Moreover, the LSE also offers extended trading hours, from 5:05 to 7:50 am and from 4:40 to 5:15 pm GMT.

New York Market Hours: 2:30 pm - 9:30 pm (GMT)

The New York Stock Exchange is open Monday through Friday from 9:30 am to 4:00 pm Eastern Daylight Time, which is from 2:30 pm to 9:30 pm GMT. The New York Stock Exchange does not close for lunch and is open for a total of 6 hours 30 minutes per day.

The New York Stock Exchange also offers extended hours trading. The Pre-Trading Session is from 9:00 am to 2:30 pm and the Post-Trading Session is from 9:00 pm to 1:00 am GMT.

Sydney Market Hours - 11:15 pm - 5:15 am (GMT)

The Sydney Stock Exchange is available Monday through Friday between 10:15 am and 4:15 pm, Australian Eastern Daylight Time (GMT+11), which is from 11:15 pm to 5:15 am GMT. Unlike the Tokyo Stock Exchange, the Sydney Stock Exchange doesn’t close for lunch. It also doesn’t offer pre-market trading or after-hours trading opportunities.

Tokyo Market Hours: 12:00 am - 6 am (GMT) with 1 hour lunch break

The Tokyo Stock Exchange is open Monday through Friday from 9:00 to 11:30 am and then from 12:30 to 3:00 pm Japan Standard Time (GMT+9), which is from 12:00 to 2:30 am and from 3:30 to 6 am London Time (GMT).

Best Time of Day to Trade Forex

As you may have already noticed, there are several times of the day when more than one market is open at the same time. Most traders agree that these overlaps provide the greatest degree of liquidity in certain currency pairs, as well as wider pip range movement. This makes, at least in theory, these periods the best times to trade.

When trading is heavier in particular currency pairs, it can give a trader the edge needed to make a profit. This is especially true for short-term traders who use strategies such as scalping or day trading. However, it’s important to bear in mind that greater volatility also presents higher risks of losing money.

The London - New York Overlap (2:30 pm - 4:30 pm GMT)

The European - US overlap is often considered to be one of the best times for trading forex. Trading in all the European currencies is heaviest during this period and offers the most liquidity for currency pairs involving the euro, pound sterling and Swiss franc.

For example, if you are trading the EUR/USD, GBP/USD or USD/CHF currency pairs, then the market for these currency pairs would probably be the most active during this period, because they represent the major currency pairs involving the United States and European countries.

The Sydney - Tokyo Overlap (12:00 am - 5:15 am GMT)

This is the period during which the New Zealand and Australian markets overlap with the Asian markets of Tokyo, Singapore and Hong Kong. This time period tends to have the most liquidity for the Australian and New Zealand dollars and their crosses.

What Is the Best Time for Trading Forex? (1)

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What Is the Best Time for Trading Forex? (2)

This overlapping time frame often sees especially active trading in the AUD/USD, AUD/JPY, EUR/AUD, NZD/USD, AUD/NZD and NZD/JPY currency pairs.

Trading Forex During the London Session in the UK

Popular forex pairs to trade during the London session are the majors such as the GBP/USD cross or the EUR/GBP cross. This is especially true during the overlap between the London and New York markets, as well as the European (Frankfurt) session which is open during almost identical hours to the London session.

Trading Forex During the New York Session from the UK

The New York session has the biggest overlap with the London session, and so it is a good time to trade forex in the UK, especially the GBP/USD cross. The New York session is the last trading window to close on the 24-hour forex trading clock, and it often experiences high trading volume as a result as traders seek to squeeze the last bit of profit out of that trading session’s news announcements and events which affect the price of currencies.

Trading Forex During the Tokyo Session from the UK

The Tokyo session is probably the least liquid of the major sessions to trade forex from the UK because of the time difference and the limited overlap.

Active pairs to trade during the Tokyo session are any JPY cross, such as USD/JPY or EUR/JPY. There is also a lot of liquidity and volatility in the AUD/JPY currency pair during the overlap between the Sydney and Tokyo session, which is one of the most volatile currency pairs on the market and the second most traded JPY cross behind USD/JPY.

Key Takeaways

  • The forex market runs on the normal business hours of four different parts of the world and their respective time zones.
  • The US/London markets overlap has the heaviest volume of trading and presents some of the best trading opportunities.
  • The Sydney/Tokyo markets overlap is not as volatile as the US/London overlap, but it still offers opportunities.

This content has been created by XTB S.A. This service is provided by XTB S.A., with its registered office in Warsaw, at Prosta 67, 00-838 Warsaw, Poland, entered in the register of entrepreneurs of the National Court Register (Krajowy Rejestr Sądowy) conducted by District Court for the Capital City of Warsaw, XII Commercial Division of the National Court Register under KRS number 0000217580, REGON number 015803782 and Tax Identification Number (NIP) 527-24-43-955, with the fully paid up share capital in the amount of PLN 5.869.181,75. XTB S.A. conducts brokerage activities on the basis of the license granted by Polish Securities and Exchange Commission on 8th November 2005 No. DDM-M-4021-57-1/2005 and is supervised by Polish Supervision Authority.

What Is the Best Time for Trading Forex? (2024)

FAQs

What Is the Best Time for Trading Forex? ›

The forex market runs on the normal business hours of four different parts of the world and their respective time zones. The U.S./London markets overlap (8 a.m. to noon EST) has the heaviest volume of trading and is best for trading opportunities.

What time is the best time to trade forex? ›

The London - New York Overlap (2:30 pm - 4:30 pm GMT) The European - US overlap is often considered to be one of the best times for trading forex. Trading in all the European currencies is heaviest during this period and offers the most liquidity for currency pairs involving the euro, pound sterling and Swiss franc.

What is the best time to make money in forex trading? ›

Forex market volatility refers to the rate at which the value of currencies fluctuates. High volatility provides more opportunities for traders to make a profit but also increases risk. The most volatile time in the market is when the London and New York sessions overlap (from 8 am to 12 pm EST).

What is the most reliable time frame for forex trading? ›

Recommendation: The best timeframe for day trading in Forex is any timeframe within the 5-minute and 1-hour. Some day traders also use the 4-hour or daily timeframes to get a broader overview of the general market direction.

What is the 5 3 1 rule in forex? ›

The 5-3-1 strategy is especially helpful for new traders who may be overwhelmed by the dozens of currency pairs available and the 24-7 nature of the market. The numbers five, three, and one stand for: Five currency pairs to learn and trade. Three strategies to become an expert on and use with your trades.

What is the best trading time? ›

The ideal time for intraday trading, according to stock market analysts, is between 10.15 a.m. and 2.30 p.m. This is because by 10.00 a.m. to 10.15 a.m., morning stock volatility has subsided. As a result, it is the ideal opportunity to place an intraday transaction.

What is the best time to trade as a day trader? ›

The opening period (9:30 a.m. to 10:30 a.m. Eastern Time) is often one of the best hours of the day for day trading, offering the biggest moves in the shortest amount of time. A lot of professional day traders stop trading around 11:30 a.m. because that is when volatility and volume tend to taper off.

Is $500 enough to trade forex? ›

This forex trading style is ideal for people who dislike looking at their charts frequently and who can only trade in their free time. The very lowest you can open an account with is $500 if you wish to initiate a trade with a risk of 50 pips since you can risk $5 per trade, which is 1% of $500.

Is $1000 enough to start forex? ›

Conclusion. In conclusion, $1000 is enough to start trading Forex. However, it's important to have a realistic trading plan and manage your risk carefully.

What is the hardest month to trade forex? ›

The forex calendar is divided into three periods of volatility. Out of these three periods, only two offer the best trading conditions. In June, July and August, volatility slows down due to the summer season, making it the worst time to trade forex.

What is the most reliable forex strategy? ›

Three highlighted profitable forex trading strategies are: Scalping strategy “Bali”, Candlestick strategy “Fight the tiger”, and “Profit Parabolic” trading strategy. How to choose: Choose a forex trading strategy based on backtesting, real account performance, and market conditions.

How long does it take to get good at forex? ›

The amount of time it takes to master forex trading on your own will vary depending on your dedication and commitment to learning. Some traders may be able to grasp the basics within a few weeks, while others may take several months or even years to become consistently profitable.

How many times a day should I trade forex? ›

One common question that many traders have is, "How many trades should I do in a day in forex?" The answer to this question is not one-size-fits-all, as the ideal number of trades can vary based on your trading style, experience, risk tolerance, and market conditions.

What is the golden rule in forex? ›

Let profits run and cut losses short Stop losses should never be moved away from the market. Be disciplined with yourself, when your stop loss level is touched, get out. If a trade is proving profitable, don't be afraid to track the market.

What is No 1 rule of trading? ›

Rule 1: Always Use a Trading Plan

You need a trading plan because it can assist you with making coherent trading decisions and define the boundaries of your optimal trade.

What is 90% rule in forex? ›

Understanding the 90% rule

This rule encapsulates a stark reality: approximately 90% of individuals who venture into forex trading fail to achieve sustained success, while the remaining 10% flourish.

When not to trade forex? ›

There will be times where a currency is moving differently from normal. Perhaps price is spiking and you don't know why. This is a good time to stay out of the market. If you can't understand why price is behaving in a certain way, it is usually due to some unscheduled news that has been released or leaked.

When should I enter a trade in forex? ›

Trade Forex During the Middle of the Week

The market is usually firing on all cylinders 24 hours after the new week has begun. During this time, the market is working out which direction it will head in as investors re-focus their attention on trading.

Is it better to trade forex at night? ›

Night trading on the forex markets has advantages for new traders as volatility tends to be lower and for experienced traders using scalping or automatic trading strategies that tend to work well with less volatility.

What time should I invest in forex? ›

While there is no undisputed "best" time to trade forex, 8am - 12pm EST is an optimal time for traders to experience high liquidity and volatility. In this four hour period, the London and New York sessions overlap and the US releases a majority of their key economic data points.

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