Best Forex Market Hours To Trade

trading sessions heading image

Are you entering the breakouts only to see it fizzle out? Have you ever wondered why? The 24/5 market hours, which the forex community pitches with pride and joy, isn’t actually a boon. Instead, it could be a trap in many ways. And it is the primary cause behind these fizzling out moves.

Why?

The market calls for a certain amount of volatility and liquidity for a setup to ferment and then validate. Say, a set of buyers haul the market past a resistance level. The follow-up move needs another set of buyers, mostly fresh hands. Because

  • Traders don’t double down on seeing their formulation pan out successfully. Instead, they tend to close out and cash out.
  • Traders, who have been clobbered owing to the break out tend to lament, “Why does this always happen to me?”, and be in the bay as well.

Ergo, we need new hands. But where can we find one?

Two options

Traders from another time zone or geography can come to your aide.

Else, you have to trade during those hours when traders are perennial and they can hurl the price action past the resistance or support and then validate it all by themselves.

After all, trading is just like a game of relay. You need to pass on the baton to someone to carry it to the finish line.

The bottom line is that the market hours you trade forex precipitate your success. So make sure you do it during the best forex market hours.

Forex market hours

The forex market operates 24×5. But, the eminent exchanges don’t. Their business hours are

Sydney Exchange: 5 PM to 2 AM (EST)
Tokyo Exchange: 7 PM to 4 AM (EST)
London Exchange: 3 AM to 12 PM (EST)
New York Exchange: 8 AM to 5 PM (EST)

It is during these times hedge funds and banks trade actively. So the market never falls short of firepower. And they do all the hard work for you — breakout and follow through. You just have to sit right from the launch pad and endure the kick off turbulence. You’re bound to reach your destination.

Best market hours to trade Forex

How can we spice it up further? If one is good, then two is better, often it becomes the best.

best forex market hours to trade

As you can see in the image, there are instances when the working hours of the two exchanges overlap. Banks and hedge funds from two super economies either fight it out or pull it off by joining hands. You can’t get better volatility and liquidity than these periods.

NY – London Session: Best of the lot

8 AM to 12 AM (EST).
Highly volatile and can even petrify you at times.
Crucial market drivers like employment, GDP and inflation data of the US, UK and European zone are released during this period. So, the market gets impetus one after the other.

Tokyo – London Session: Quickie

3 AM to 4 AM (EST).
It might seem just like an hour, but it still matters if you’re a scalper or day trader.
Further, the hour, prior and forth to this period, have decent volume as well.

volume liquidity volatility during best forex market hours

Look for the mountains among the hills in the volume. They are the NY – London session with soaring volume. But if you watch closely, you can spot a ridge popping out every day 4 hours prior to the mountains. It is the Tokyo-London session. These are the best market hours with the highest number of trade executions in forex.

Tokyo – Australian Session: Underling

7 PM to 2 AM (EST).
Although it is not as decisive as the above two, it matters at times.
It takes center stage during the FOMC meetings since the press conference and minutes comes to limelight post US market hours.
Rest of the days, it renders decent volatile as the Asian exchanges are open during these hours.
AUD/USD, NZD/USD, AUD/JPY and NZD/JPY make their prominent move during this period as well.

Can you keep track of the forex market hours?

For non-western traders, the times can be fuzzy. Let’s make it simple for you.
There is a tool which can plot all the session in your charts and give the OHLC of the period as well.
It’s the Session Indicator. And it’s completely free!
Voila! You didn’t see that one coming, right?

session indicator showing forex market hours

Get the Session indicator for free to spot the best forex market hours in just a glance.
It makes your life as a trader a lot easier!

Conclusion

The prerequisites of a good setup are volatility and liquidity. And the best market hours can guarantee it.
But it doesn’t vouch for success and profitability, which entirely depends on your strategy.
The strategy should be the linchpin in your decision making; however, use these kinds of smart nuances as a catalyst.