The foreign exchange market is the largest and most liquid financial market in the world, with daily trading volumes of over $5 trillion. It operates 24 hours a day, five days a week, from Monday to Friday, and offers traders the opportunity to buy and sell currencies from around the world. However, not all trading hours are equal, and some forex pairs are more active and volatile during certain times of the day. In this article, we will explore which are the best forex pairs to trade from 8a.m. to 12p.m.
The forex market is divided into three major trading sessions: the Asian, European, and North American sessions. These sessions overlap at different times of the day, creating periods of high activity and volatility. The 8a.m. to 12p.m. period is when the European session and the North American session overlap, and it is often considered the most active and volatile time of the day.
The European session starts at 3a.m. EST and ends at 12p.m. EST, while the North American session starts at 8a.m. EST and ends at 5p.m. EST. The overlap between these two sessions creates a period of high liquidity and volatility, as traders from both regions are active in the market. This makes it an ideal time for traders to enter and exit positions, as there is a higher chance of price movements and opportunities for profit.
The best forex pairs to trade during this period are the major currency pairs, which are the most actively traded currencies in the world. These include the EUR/USD, USD/JPY, GBP/USD, USD/CHF, AUD/USD, and USD/CAD. These pairs are highly liquid, meaning there is a large volume of buyers and sellers at any given time, and they often have tight bid-ask spreads, which reduces the cost of trading.
The EUR/USD is the most actively traded currency pair in the world, accounting for almost 30% of the daily trading volume in the forex market. The Euro is the second-largest reserve currency in the world, and the US dollar is the dominant global currency, making this pair highly liquid and volatile. During the 8a.m. to 12p.m. period, the EUR/USD often experiences high volatility, as traders react to economic news and events from both regions.
The USD/JPY is another popular currency pair, accounting for around 17% of the daily trading volume in the forex market. The Japanese yen is often used as a safe-haven currency, meaning it tends to appreciate in times of market uncertainty. During the 8a.m. to 12p.m. period, the USD/JPY often experiences high volatility, as traders react to economic news and events from both regions.
The GBP/USD is also a highly traded currency pair, accounting for around 12% of the daily trading volume in the forex market. The British pound is the fourth-largest reserve currency in the world, and the US dollar is the dominant global currency, making this pair highly liquid and volatile. During the 8a.m. to 12p.m. period, the GBP/USD often experiences high volatility, as traders react to economic news and events from both regions.
The USD/CHF is a less popular currency pair, accounting for around 5% of the daily trading volume in the forex market. The Swiss franc is often used as a safe-haven currency, meaning it tends to appreciate in times of market uncertainty. During the 8a.m. to 12p.m. period, the USD/CHF often experiences high volatility, as traders react to economic news and events from both regions.
The AUD/USD and the USD/CAD are also highly traded currency pairs, accounting for around 7% and 4% of the daily trading volume in the forex market, respectively. The Australian dollar and the Canadian dollar are both commodity currencies, meaning their value is closely linked to the prices of commodities such as oil and gold. During the 8a.m. to 12p.m. period, these pairs often experience high volatility, as traders react to economic news and events from both regions.
In conclusion, the 8a.m. to 12p.m. period is an ideal time for traders to enter and exit positions in the forex market, as it is the most active and volatile time of the day. The best forex pairs to trade during this period are the major currency pairs, which are highly liquid and often have tight bid-ask spreads. These include the EUR/USD, USD/JPY, GBP/USD, USD/CHF, AUD/USD, and USD/CAD. Traders should also pay attention to economic news and events from both regions, as they can have a significant impact on currency prices.
