Forex market is the biggest financial market in the world, with a daily trading volume of over $5 trillion. It operates 24 hours a day, five days a week, with three major trading sessions: Asian, European, and American. Each session has its unique characteristics, and traders need to understand them to maximize their profits.
In this article, we will discuss an easy way to find market turns in forex during the Asian trading session. But before we dive into the details, let’s first understand what the Asian trading session is and why it’s important.
The Asian trading session starts at 12:00 am GMT and ends at 9:00 am GMT. It is the first major trading session of the day, and it includes the markets of Tokyo, Hong Kong, Singapore, and Sydney. The Asian session is known for its low volatility, tight trading range, and slower price movements compared to the European and American sessions.
However, despite its slower pace, the Asian session can still present opportunities for traders to profit. Here’s how you can find market turns during the Asian trading session:
1. Use Technical Analysis
Technical analysis is a popular trading approach that involves analyzing charts and price patterns to predict future market movements. During the Asian trading session, traders can use technical analysis to identify key levels of support and resistance.
Support and resistance levels are price levels where the market tends to bounce or reverse. Traders can use these levels to enter or exit trades, depending on the direction of the market. To find support and resistance levels during the Asian session, traders can use indicators like moving averages, pivot points, and Fibonacci retracements.
2. Watch for News Releases
Even though the Asian session is known for its low volatility, news releases can still cause significant price movements. Traders should keep an eye on economic news releases from countries like Japan, Australia, and China, as they can affect the value of their respective currencies.
For example, if the Bank of Japan announces a change in its monetary policy, it can cause the Japanese yen to strengthen or weaken, depending on the direction of the change. Traders can take advantage of these news releases by entering trades based on the direction of the market movement.
3. Monitor Market Sentiment
Market sentiment refers to the overall attitude of traders towards a particular currency pair. Traders can use market sentiment to determine whether the market is bullish or bearish and make trading decisions accordingly.
During the Asian session, traders can monitor market sentiment by analyzing the trading volume and open interest in key currency pairs like USD/JPY, AUD/USD, and EUR/JPY. If the trading volume and open interest are high, it indicates that traders are actively buying or selling the currency pair, and the market sentiment is strong.
4. Follow Price Action
During the Asian session, traders can follow price action by analyzing candlestick charts and looking for patterns like dojis, hammers, and shooting stars. These patterns can indicate a potential reversal in the market, and traders can enter or exit trades accordingly.
In conclusion, finding market turns during the Asian trading session requires a combination of technical analysis, news monitoring, market sentiment analysis, and price action analysis. By using these tools, traders can identify key levels of support and resistance, take advantage of news releases, determine market sentiment, and follow price action to make profitable trades.