The forex market is the largest financial market in the world, with an average daily turnover of over $5 trillion. It operates 24 hours a day, five days a week, allowing traders to buy and sell currencies at any time. However, there are times when the market is closed, and one of these times is during the New Year’s holiday.
When Does Forex Market Close for New Year’s?
The forex market operates from Monday to Friday, and it is open 24 hours a day. However, the market is closed during weekends and some national holidays. The New Year’s holiday is one of the national holidays that the forex market observes, and during this time, the market is closed.
The forex market usually closes on December 31st, New Year’s Eve, at 5 pm EST. This closure marks the end of the trading year and the start of the New Year. The market remains closed on January 1st, New Year’s Day, and trading resumes on January 2nd.
It is important to note that the forex market is a global market, and different countries have different time zones. Therefore, the market closure time for New Year’s may vary depending on the time zone you are in. For example, traders in Australia may experience a different market closure time compared to traders in the United States.
Why Does Forex Market Close for New Year’s?
The forex market closure during the New Year’s holiday is not unique to forex trading alone. Most financial markets worldwide observe national holidays, and these holidays affect trading hours.
The forex market closes for New Year’s to allow traders and brokers to take a break and celebrate the holiday. It is also a time for market participants to reflect on the past year’s performance and plan for the new year.
During the New Year’s holiday, there is usually low liquidity in the forex market, and trading volume is significantly lower than usual. This low liquidity can lead to increased volatility, and traders who choose to trade during this period may experience wider spreads and slippage.
In addition, market participants may also be more cautious during the holiday period, leading to low trading activity. This caution may be due to the uncertainty that comes with the start of a new year, as traders wait to see how the markets perform before making any significant trades.
The forex market is a 24-hour market that operates five days a week, allowing traders to buy and sell currencies at any time. However, the market is closed during national holidays, including the New Year’s holiday.
The forex market usually closes on December 31st at 5 pm EST and reopens on January 2nd. During this period, there is usually low liquidity, and traders may experience wider spreads and slippage.
The New Year’s holiday is a time for traders and brokers to take a break and celebrate the holiday, reflect on the past year’s performance, and plan for the new year. It is important for traders to note the market closure times for national holidays to avoid any significant losses during low liquidity periods.