Forex Trading Sessions

The forex market opens at 5pm on Sunday and closes at 5 pm on Friday.

However, even though the market is open it doesn’t mean the majority of the traders are awake. When traders in a location are inactive or sleeping it reduces the market flow & liquidity.

There are periods when traders from different continents are online at the same time, & that is the best time to jump in the market & trade.

For instance, if you are going to trade a pair like the EUR/USD, you need to do so when most of the traders in Europe & North America are awake & active.

The forex market opens at different times on different continents due to time zone differences & this is referred to as forex trading sessions.

List of forex trading sessions:

The Asian session comprises the Tokyo & Sydney sessions. Most people outside Asia will usually experience the Asian sessions at night and it has the poorest liquidity.

During the Asian session you can trade Asian currency pairs such as AUD/JPY, NZD/JPY, AUD/USD, USD/JPY etc.
Manufacturing companies, Banks, exporters, etc. are the major players during the Asian session.

The London & New York sessions are active with all sorts of participants and are best for trading the popular EUR/USD, & GBP/USD pairs.

Best Time to Trade Forex

Try Our Forex Time Zone Converter Tool

London New York Overlap

The best time to trade forex is when the London & New York sessions overlap around 13:00 & 17:00 hours GMT. The best days of the week to trade forex are Tuesdays till Friday morning.

This time zone converter table shows the times when different sessions are most active and when they overlap (highlighted in green)

London & New York account for the highest volume of currency trading on the planet and this is why when these sessions overlap, liquidity peaks & spread fees are low especially when you’re trading the EUR/USD pair.

London Frankfurt Overlap

The London & Frankfurt sessions overlap by 7am till 8am GMT in the morning and during this 1 hour window, volatility is always high.

When targeting the London Frankfurt overlap, you should lookout for false breaks (aka frankiefake) because volatility will be so high that spikes could occur now & then.

Also ensure you trade pairs that contain the Euro, & consult your economic calendar for any economic data that may be released.

When you trade during the right sessions, you also notice chart patterns and trends tend to be clearer and form more visibly. This makes it easy to analyze the charts and pick good market entry & exit points.

Worst Time to Trade Forex

During The Asian Session

The Asian session starts around 1am and ends around 9 am GMT in the morning.
The Asian session is not a great time to trade forex because it has fewer market participants. The Asian session also takes place when it is night in most parts of the world so lots of people will already be asleep.

Monday Morning & Friday Afternoon

On Monday mornings there’s always a rush to set things up and take care of market gaps that occurred over the weekend, etc. so the markets can be a bit unstable.

On Fridays after 12 pm, there’s usually a rush to close for the weekend, apply triple overnight swaps to positions that will be left open over the weekend, etc. This makes Friday noon a rush hour hence markets can be unstable and not suitable for trading.

After Major News Releases

After breaking news releases, markets can become erratic with traders rushing to cover their short positions, rushing to manage their risk, etc.

Because of this erratic behavior, trends may not form properly on charts, patterns on charts form incompletely, etc. There is generally a high risk of losses when trading after important news releases.

Also look out for news about political events such as elections, referendums, riots, industrial actions, etc. as these too can move the market.

Bank Holidays

Banks are major players in the online forex market because they provide liquidity to the brokers who also get their exchange rate pricing from banks. When major banks are on holiday, spreads may widen so you could end up paying higher fees.

Major Sports Events

During global sports events such as the world cup finals, only a few traders may be in the market because most of them would be watching the event. Fewer market participants could mean wider spreads/fees.

After A Big Loss

After you sustain a big loss while trading, the best thing is to call it a day. If you keep on trading, you might want to recoup all your losses by trading without risk management and that will only result in more losses. Losers average losers!

For example, if you made a loss during the London session, and you are trading into the NY session to recover your losses, when you normally don’t trade the NY session, you are very likely to end up with a bigger loss, which will affect your emotional balance going into the next days as well.

So, it is always best to take a step back, and focus on your process rather than the immediate outcome.

Advantages of Trading During the Right Session