Forex trading is one of the most popular and lucrative financial markets in the world. It involves the buying and selling of currencies from different countries in order to make a profit. However, forex trading is not a 24/7 market. It has specific trading hours and days, and it’s important to understand these in order to maximize your profits. In this article, we will explain when forex starts trading and what you need to know about the trading hours.
Forex Trading Hours
Forex trading hours vary depending on the country and the exchange that you are trading in. However, there are some general guidelines that apply to most forex markets. Forex trading starts on Sunday at 5pm EST (Eastern Standard Time) and ends on Friday at 5pm EST. This means that there is a 24-hour gap between the end of one trading session and the beginning of another.
Another thing to note is that forex trading is not open on weekends. This means that there is no trading on Saturday and Sunday. This is because the forex market is decentralized, meaning that it doesn’t have a physical location. Instead, it operates through a network of banks, financial institutions, and brokers who trade currencies electronically.
The forex market is divided into four major trading sessions: the Asian session, the European session, the North American session, and the Pacific session. Each session has its own trading hours, which are based on the local time zone.
Asian Session
The Asian session starts at 11pm EST and ends at 8am EST. This session is dominated by the Japanese yen, the Australian dollar, and the New Zealand dollar. This session is also known for its low volatility, as most of the major financial centers in Asia are closed during this time.
European Session
The European session starts at 2am EST and ends at 11am EST. This session is dominated by the Euro, the British pound, and the Swiss franc. This session is known for its high volatility, as most of the major financial centers in Europe are open during this time.
North American Session
The North American session starts at 8am EST and ends at 5pm EST. This session is dominated by the US dollar, the Canadian dollar, and the Mexican peso. This session is also known for its high volatility, as most of the major financial centers in North America are open during this time.
Pacific Session
The Pacific session starts at 5pm EST and ends at 2am EST. This session is dominated by the Japanese yen and the Australian dollar. This session is also known for its low volatility, as most of the major financial centers in the Pacific region are closed during this time.
When Should You Trade?
The optimal time to trade forex depends on your trading strategy and your personal preferences. If you are a day trader, you may want to focus on the European and North American sessions, as these are the most volatile and offer the most trading opportunities.
If you are a swing trader, you may want to focus on the Asian and Pacific sessions, as these are the least volatile and offer a more relaxed trading environment.
It’s also important to consider your time zone and your personal schedule when deciding when to trade. If you live in Europe, the European session may be the best time to trade, as it aligns with your local time zone. If you have a full-time job, you may want to focus on the North American session, as it overlaps with your work hours.
Conclusion
Forex trading is a 24/5 market, which means that it’s important to understand the trading hours in order to maximize your profits. The forex market is divided into four major trading sessions, each with its own trading hours and dominant currencies. The optimal time to trade depends on your trading strategy, your personal preferences, and your time zone. By understanding the trading hours, you can make informed trading decisions and maximize your profits in the forex market.
