Best Hours and Times for Forex Trading – The optimal time to trade in the forex (Foreign Exchange) market is when it is at its most active level, when trading is spread out (the difference between the bid price and the ask price tends to narrow. In this situation less money comes in. to market makers who facilitate currency trading, leaving more money to buy and sell investors into private pockets.
The Four Major Forex Exchanges
The four major forex exchanges are located in New York, London, Singapore and Tokyo. When more than one exchange is opened simultaneously, this not only increases trading volume, but also increases volatility (rate and rate of change in equity or currency prices), which also benefits forex traders. This may seem paradoxical. However, investors are generally afraid of market volatility. But in the forex game, greater volatility means a greater chance of a payoff.
Worldwide Forex Market Hours and Times
Before you look at the hours for the best forex trading, you should understand the conversion times from EST to GMT + 7 by looking at the following hour conversions:
Forex has fifteen independent exchanges around the world, open every week from Monday to Friday – each with unique trading hours. But from a trading perspective, the four most important times or hours are as follows (the time shown represents Time EST): EST stands for Eastern Standard Time. And WIB is GMT + 7 for Jakarta, Indonesian time is 11 hours ahead of EST.
- London: 3am to 12pm (noon)
- New York: 8 a.m. to 5 p.m.
- Singapore: 3pm to 12:00 pm (midnight)
- Tokyo: 7pm to 4am
In our time GMT +7 here are the best hours and times for forex trading:
- London: 2 p.m. to 11 p.m.
- New York: Unfortunate 7 to 4 am
- Singapore: 2am to 11pm
- Tokyo: 6 a.m. to 3 p.m.
While each exchange functions independently, they all trade the same currency. As a result, when two exchanges open, the number of traders actively buying and selling a particular currency will increase dramatically. The bid and demand on one forex market exchange immediately impacts the bid and demand on all other open exchanges, reducing market spread and increasing volatility. This certainly happens in the following hours or times in EST:
- 8:00 am to 12:00 pm, with the New York and London exchanges open
- 3pm to 5pm, with the New York and Singapore exchanges open
- 7:00 pm to 24:00 pm, with the Tokyo and Sydney exchanges open
- 3:00 am to 4:00 pm, with the Tokyo and London exchanges open
In GMT +7
- 7am to 11pm, with the New York and London exchanges open
- 2am to 6am, with the New York and Singapore exchanges open
- 6am to 11pm, with the Tokyo and Sydney exchanges open
- 2pm to 3pm, with the Tokyo and London exchanges open
The most profitable trading times are 8am to noon (7am to noon GMT + 7), when the New York and London exchanges are open. These two trading centers account for more than 50% of all forex trading. On the other hand, from 5pm to 6pm EST (4am to 5am WIT or GMT + 7), the only operation open for business is the Singapore exchange, which accounts for less than 10% of annual forex trading volume . But there are exceptions. A political or military crisis that develops during this hour, potentially soaring volatility and trading volume, makes it the perfect time to trade.
The Best Time Does Not Always Mean Profitable
Forex traders should proceed with caution, as currency trading often involves high levels of leverage from 1000 to 1. While this ratio offers tantalizing profit opportunities, it comes with the risk of the investor losing the entire investment on a single trade. In fact, a 2014 Citibank study found that only 30% of retail forex traders break even or better. But what is clear, 84% of those surveyed believe that they can make money in the forex market. Head of takeaway: new forex investors should open accounts with companies that offer demo platforms, which will allow them to make mock forex trades and calculate imaginary profits and losses, until investors become experienced enough to be confident when trading for real.
And that’s an explanation of the best hours and times for forex trading, make sure you trade at the best hours that I have mentioned above. Hopefully this is useful 🙂