The forex market is a global decentralized market where currencies are traded. It is the largest financial market in the world with a daily trading volume of over $5 trillion. The market is open 24 hours a day, five days a week, starting from Sunday 5:00 pm EST and ending on Friday 5:00 pm EST. The reason why the forex market starts on Sunday is due to the time zone differences between countries.
Forex trading is conducted over-the-counter (OTC) where buyers and sellers trade directly with each other. Unlike other financial markets such as the stock market, there is no central exchange or regulator in the forex market. Instead, forex trading is conducted electronically through computer networks between banks, financial institutions, and individual traders.
The forex market is open 24 hours a day because it is a global market that operates in different time zones. The forex market opens on Sunday at 5:00 pm EST when trading starts in Sydney, Australia. This is followed by Tokyo, Japan, at 7:00 pm EST, then Singapore and Hong Kong at 9:00 pm EST. As the day progresses, trading in Europe begins at 2:00 am EST with London, followed by Frankfurt at 3:00 am EST.
The forex market then moves to New York, where trading begins at 8:00 am EST. This is the busiest time of the day as it overlaps with the European trading hours, creating high volatility in the market. Finally, the market closes on Friday at 5:00 pm EST when trading stops in New York.
The reason why the forex market operates 24 hours a day is that there is always a market open somewhere in the world. This allows traders to take advantage of different time zones and trade in different markets at any time of the day or night. It also allows traders to respond quickly to global news events and economic data releases that can affect currency prices.
Another reason why the forex market operates 24 hours a day is that it is a highly liquid market. Liquidity refers to the ease with which an asset can be bought or sold without affecting its price. The forex market is highly liquid because there are always buyers and sellers in the market, which means traders can buy or sell currencies at any time without affecting the price.
In conclusion, the forex market starts on Sunday because it operates 24 hours a day, five days a week, in different time zones around the world. This allows traders to take advantage of different markets and respond quickly to global news events and economic data releases. The forex market is highly liquid, which means traders can buy or sell currencies at any time without affecting the price.
