The foreign exchange market, also known as forex or FX, is a global decentralized market where currencies are traded 24 hours a day, 5 days a week. However, there are times when the forex market is closed, and traders cannot execute trades.
The forex market is closed on weekends, which means that no trading activity takes place on Saturdays and Sundays. The market typically opens on Sunday at 5:00 pm EST (10:00 pm GMT) and closes on Friday at 5:00 pm EST (10:00 pm GMT). This means that the forex market is open for trading for 24 hours a day from Sunday to Friday.
However, it is important to note that the forex market is not open for 24 hours continuously. The market is divided into four major trading sessions, which include the Sydney session, the Tokyo session, the London session, and the New York session. Each trading session has its own unique characteristics and trading hours.
The Sydney session starts at 10:00 pm GMT and ends at 7:00 am GMT. This session is known for its low trading volume and volatility. The Tokyo session starts at 12:00 am GMT and ends at 9:00 am GMT. This session is known for its high trading volume and volatility, particularly during the overlap with the London session.
The London session starts at 8:00 am GMT and ends at 5:00 pm GMT. This session is the most active and liquid session of the forex market, as it overlaps with the Tokyo and New York sessions. The New York session starts at 1:00 pm GMT and ends at 10:00 pm GMT. This session is also known for its high trading volume and volatility, particularly during the overlap with the London session.
Apart from weekends, the forex market is also closed on certain public holidays in different countries. For example, the forex market is closed on Christmas Day, New Year’s Day, and Thanksgiving Day in the United States. During these holidays, trading activity slows down significantly, and liquidity may be lower than usual.
In addition, there are times when the forex market experiences low liquidity and volatility, even though it is technically open for trading. These include the periods just before and after major economic events, such as central bank meetings and interest rate announcements. During these times, traders may find it difficult to execute trades or may experience increased slippage, which is the difference between the expected price of a trade and the actual price at which it is executed.
In conclusion, the forex market is closed on weekends and certain public holidays in different countries. The market is divided into four major trading sessions, each with its own unique characteristics and trading hours. Traders should be aware of these times and plan their trading strategies accordingly to maximize their chances of success.
