The forex market, also known as the foreign exchange market, is a global decentralized market for the trading of currencies. It is the largest financial market in the world, with an average daily turnover of over $5 trillion. The forex market is open 24 hours a day, five days a week, which means that traders can trade currencies at any time of the day or night. However, there are certain times when the market is more active, and other times when it is quieter. In this article, we will explain what time the forex market closes and why it is important for traders to know this.
The forex market is divided into four major trading sessions: the Sydney session, the Tokyo session, the London session, and the New York session. Each of these sessions has its own characteristics and trading hours, which overlap with each other to create a continuous 24-hour market. The Sydney session starts at 10 pm GMT on Sunday and closes at 7 am GMT on Monday. The Tokyo session starts at midnight GMT and closes at 9 am GMT. The London session starts at 8 am GMT and closes at 5 pm GMT, while the New York session starts at 1 pm GMT and closes at 10 pm GMT.
The forex market closes on Friday at 10 pm GMT, after the New York session. This means that traders cannot trade currencies during the weekend. The market then reopens on Sunday at 10 pm GMT with the start of the Sydney session. It is important for traders to know when the forex market closes because it affects their trading strategies and decisions. For example, if a trader has an open position on a currency pair on Friday, they may want to close it before the market closes to avoid any unexpected price movements over the weekend.
Another reason why it is important to know when the forex market closes is because it affects the liquidity and volatility of the market. Liquidity refers to the ease with which traders can buy and sell currencies without affecting the price. Volatility refers to the degree of price fluctuations in the market. The forex market is most liquid and volatile during the overlap of the London and New York sessions, which occurs between 1 pm GMT and 5 pm GMT. This is because these two sessions account for the majority of forex trading activity, as they involve major financial centers such as London and New York.
Knowing when the forex market closes also helps traders to plan their trading schedule. For example, if a trader is based in Australia, they may prefer to trade during the Sydney and Tokyo sessions, as these sessions are more active during their daytime hours. On the other hand, if a trader is based in Europe, they may prefer to trade during the London session, as this session is more active during their daytime hours. It is important for traders to choose the trading sessions that best suit their schedule and trading style.
In conclusion, the forex market closes on Friday at 10 pm GMT and reopens on Sunday at 10 pm GMT. Knowing when the forex market closes is important for traders because it affects their trading strategies and decisions, as well as the liquidity and volatility of the market. Traders should also choose the trading sessions that best suit their schedule and trading style. By understanding the trading hours of the forex market, traders can make informed decisions and maximize their trading opportunities.
