If you want to trade at the best time in Forex, then we will help you discover the best trading hours.
Forex is the worldwide market that is open 24 hours a day. Whereas many other markets, such as the stock market, are open only during business hours, and the time zone of different areas also varies. But in Forex, the trader has the freedom to trade at any time. But still, there are some preferred time frames in which profit is guaranteed.
Although there is no guarantee that the best time to trade in Forex exists, profit involves many other factors, such as strategies, aim, and preferences of the trader. So, in this article, we will help you identify the best time to trade Forex.
Best Trading Times
According to many professional traders, Monday afternoon is the best time to trade Forex. However, trading in the morning should be avoided because the market has already begun. Also, at this time, volume is increasing. But on Monday afternoon, liquidity was high so that the trading could be worthwhile. Many successful traders usually trade at this time.
When multiple trading sessions overlap
When many trading sessions overlap, there are huge chances of a successful trade. London is the busiest market where many trading sessions overlap. The New York time zone also overlaps many other time zones. Traders can take this opportunity when the market is busy and many other time zones overlap. Professionals also discover that 14:00 GMT is the best time to trade. The London time zone will close, and the New York time zone will start. Also, prices could fluctuate and could become unpredictable. However, this overlap could present a fantastic opportunity for the trader.
Many other time zones also overlap, such as the time zone of Tokyo and Sydney, from noon to 7:00GMT. However, it is not as beneficial as New York and London time zones but could bring profitable trading.
During times of high liquidity (i.e., Tuesday through Thursday),
Monday afternoon is considered the best time to trade, but at that time, liquidity is not at its peak. Tuesday through Thursday are the busiest days for liquidity. If you want to trade when liquidity is at its peak, you should trade in the middle of the week because liquidity is high at this time.
The London time zone is the busiest session that gets a lot of trading. According to the research, the London time zone is when trading is at its peak, and more than 30% of trading is done at this time. The time zone of London is the busiest of all other time zones. Review FX is the best for beginners to tell peak time zones of London.
Overlaps in Forex Trading Times
Overlapping time is considered the best time to trade in Forex. Overlapping means when two markets are open at the same time and prices are high at this time. Also, overlapping time provides many other opportunities. Here are some of the best time zones that overlap in a day.
(8 a.m. to noon) in the United States/London:
The busiest overlap occurs between the time zones of the US and London. According to research, 50% of trading is done in this time zone because the US and London have the most popular and demanding currencies. This is the best time to trade when volatility is high.
Sydney/Tokyo (2 a.m. to 4 a.m.)
Although Sydney and Tokyo are not as fruitful as the US and LIPO overlap, there is a high chance of successful trade. Sydney and Tokyo are ideal currency pairs because these currencies’ prices fluctuate and give the trader an advantage.
London/Tokyo (3 a.m. to 4 a.m.)
This overlap gives the minimum for successful trading, but this one hour could give great opportunities to the trader. Because at this time, large pip changes could occur.
The Bottom Line
Knowing how to best trade Forex is important because a trader could get an advantage and gain many opportunities. Also, overlapping times usually give successful trades. So, the trader should keep an eye on the news and know when high volatility is. This way, part-time and full-time traders could profit by setting their schedules according to time zones.
One of the main advantages of knowing the best time to trade is that the trader will not be frustrated and can get time to sleep and take their eyes off the market.