The forex market is open 24 hours a day, five days a week. It is the largest and most liquid market in the world, with an average daily trading volume of over $5 trillion. The forex market is decentralized, which means that there is no central exchange where all trades are executed. Instead, forex trading is conducted electronically over-the-counter (OTC), which means that traders can buy and sell currencies directly with each other through a network of banks and financial institutions.
The forex market is open for trading from Sunday at 5:00 pm EST (10:00 pm GMT) to Friday at 5:00 pm EST (10:00 pm GMT). However, the market is not open for the entire 24-hour period. Instead, the forex market is divided into four major trading sessions: the Sydney session, the Tokyo session, the London session, and the New York session.
The Sydney session, also known as the Asia-Pacific session, is the first major trading session to open. It begins at 5:00 pm EST (10:00 pm GMT) on Sunday and runs until 2:00 am EST (7:00 am GMT) on Monday. The Sydney session is dominated by the Australian dollar, the New Zealand dollar, and the Japanese yen. It is also the least volatile of the four major trading sessions, as most of the major financial centers in the world are closed during this time.
The Tokyo session, also known as the Asian session, begins at 7:00 pm EST (12:00 am GMT) on Sunday and runs until 4:00 am EST (9:00 am GMT) on Monday. The Tokyo session is dominated by the Japanese yen, but it also sees significant trading activity in other Asian currencies such as the Singapore dollar, the Hong Kong dollar, and the Chinese yuan.
The London session, also known as the European session, is the most important trading session in the forex market. It begins at 3:00 am EST (8:00 am GMT) and runs until 12:00 pm EST (5:00 pm GMT). The London session is dominated by the British pound, the euro, and the Swiss franc. It is also the most volatile of the four major trading sessions, as it overlaps with the opening of the New York session.
The New York session, also known as the North American session, begins at 8:00 am EST (1:00 pm GMT) and runs until 5:00 pm EST (10:00 pm GMT). The New York session is dominated by the US dollar, but it also sees significant trading activity in other North American currencies such as the Canadian dollar and the Mexican peso. It is also the second most volatile of the four major trading sessions, as it overlaps with the closing of the London session.
It is important to note that the forex market is not limited to these four major trading sessions. There is also significant trading activity in other parts of the world, such as the Middle East and Africa. However, these trading sessions are not as significant as the four major trading sessions, and they tend to have lower trading volumes and lower liquidity.
In conclusion, the forex market is open 24 hours a day, five days a week, but it is divided into four major trading sessions: the Sydney session, the Tokyo session, the London session, and the New York session. Each trading session is dominated by different currencies, and each session has its own level of volatility and liquidity. By understanding the different trading sessions, forex traders can make informed decisions about when to enter and exit trades, and which currencies to focus on.
