Not all hours of the day are equally good for trading. The best time to trade forex is when the market is most active. When one of the three markets are open simultaneously, there will be a heightened trading atmosphere, which means there will be more significant fluctuation in currency pairs.
Forex market is open 24 hours a day. It provides a great opportunity for traders to trade at any time be it day or night. To become a successful Forex trader, it is important for he or she to identify the correct time to trade.
Currency pairs tend to get locked in a tight spread of roughly 20 pips of movement when only one market is open. Two markets opening at once can see movement north of 60 pips, particularly when economic data is released.
The forex market opens at different times in different countries. In the U.S., there is no set time for the market to open, but it usually opens between 8:00 am and 10:00 am. However, if you are located in the Middle East, the market will usually open between 4:00 am and 7:00 am.
If you are wondering how to participate in those volatile trading hours, you may use a day and time converter. It is a great tool for forex traders to know their local time across the globe. It is also a great tool for people who have a few hours of vacation and want to make sure they don’t miss a trade.
However, trading hours can be different according to the time of the year. This is called daylight savings. Daylight Savings Time is the practice of advancing the clocks during the day to increase the amount of sunlight in the evening and reduce the amount of daylight in the morning. This practice is done so that there is more daylight in the evening to do outdoor activities.
Knowing the best time to trade is NOT relevant for swing traders who wish to capture short to medium price movement which can last from a few days to several weeks. Day traders or scalpers that specialize in profiting off a small price change will be necessary.
Day traders and scalpers that specialize in buying and selling off a small price change will be beneficial. If the price of a currency pair goes up, they will buy, and if it goes down, they will sell. The fluctuation of the currency pair is what matters to these groups of traders. They hardly keep any open positions overnight and will attempt to trade the next day.
With that said, we hope that you are able to use this advice to start making some money in the market. Please feel free to reach out to us anytime if you have any questions or comments. We would love to hear from you!