The foreign exchange (forex) market operates 24 hours a day, five days a week. This means that trading is ongoing from Monday to Friday, with different regions taking turns to dominate the market at different times. The Asian forex session is one of the most active trading sessions, with high liquidity and volatility. In this article, we will explore when the Asian forex session begins and what factors impact its performance.
The Asian forex session, also known as the Tokyo session, begins at 12:00 AM GMT (7:00 PM EST) and ends at 9:00 AM GMT (4:00 AM EST). This session covers the trading hours of major financial centers in Asia, including Tokyo, Hong Kong, Singapore, and Sydney. The Asian session is the first to open after the weekend, and it sets the tone for the rest of the day’s trading.
One of the reasons why the Asian session is highly traded is because it overlaps with the European session for several hours. This overlap creates a period of high liquidity, where traders can take advantage of price movements in the market. Additionally, the Asian session is active during the release of important economic data from Japan, China, and Australia, which can impact the performance of the currency pairs in question.
During the Asian session, the Japanese yen (JPY) is one of the most traded currencies, making up around 20% of all forex trades. The currency is highly sensitive to economic data releases from Japan, such as GDP, inflation, and trade balance figures. Traders also closely monitor the Bank of Japan’s monetary policy decisions, which can impact the value of the yen against other currencies.
The Chinese yuan (CNY) and Australian dollar (AUD) are also popular currency pairs during the Asian session. The Chinese yuan is closely linked to China’s economic performance, and traders pay close attention to reports on inflation, trade, and manufacturing data. The Australian dollar, on the other hand, is often referred to as a commodity currency due to its close ties with Australia’s mining and export sectors. Traders keep a close eye on commodity prices, such as gold and iron ore, which can impact the value of the Australian dollar.
Another factor that impacts the performance of the Asian forex session is the level of geopolitical risks in the region. Asia is home to several countries that are involved in ongoing political tensions, such as North Korea, South Korea, and China. These tensions can lead to market volatility, as traders react to news and developments in the region.
In conclusion, the Asian forex session begins at 12:00 AM GMT and ends at 9:00 AM GMT, covering the trading hours of major financial centers in Asia. The session is highly traded due to its overlap with the European session, as well as the release of important economic data from Japan, China, and Australia. The Japanese yen, Chinese yuan, and Australian dollar are popular currency pairs during the Asian session, with their performance closely tied to economic data and geopolitical risks in the region. As with any trading session, it is essential to keep up-to-date with market news and developments to make informed trading decisions.
