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5 Best Forex Trading Hours

5 Best Forex Trading Hours

5 Best Forex Trading Hours

If you have been used to watching prime time TV, then you must be wondering what the prime time forex trading is as a forex trader. Forex market is a 24-hour market that never closes.

This makes it quite different than the stock market that has an official open and an official close. In the forex market, there is no official open or close. You will find continuous action in the forex market around the clock 24/5. It only closes on the weekends.

This constant nature of the forex market is due to the different financial centers that matter being spread across all the time zones. In forex trading, we talk of the Asian Trading Session when the Asian Currency Market centered on Tokyo, Hong Kong, Singapore, and Sydney is active.

When the Asian Session closes, the European Trading Session starts! In the European Trading Session, London and Frankfurt are the two most important centers. London is still the most important currency trading center in the world. After that the US Trading Session with centers at Ney York and Chicago.

If you have been used to watching prime time TV; then you must be wondering what the prime time forex trading is as a forex trader. Forex market is a 24-hour market that never closes. This makes it quite different than the stock market that has an official open and an official close.

In the forex market, there is no official open or close. You will find continuous action in the forex market around the clock 24/5. It only closes on the weekends. This constant nature of the forex market is due to the different financial centers that matter being spread across all the time zones.

In forex trading, we talk of the Asian Trading Session when the Asian Currency Market centered on Tokyo, Hong Kong, Singapore, and Sydney is active. When the Asian Session closes, the European Trading Session starts! In the European Trading Session, London and Frankfurt are the two most important centers. London is still the most important currency trading center in the world. After that, the US Trading Session with centers at Ney York and Chicago.

Now, did you observe one thing common between all these six heavily traded currency pairs? Yes, USD or the US Dollar. All these six major currency pairs are being traded against the US Dollar.

What type of data affects the USD during these five hours, you might ask. The most important economic news releases like the FOMC Meeting Minutes, The NFP Report, the COT Report, and other essential reports are released around 8:30 AM EST as well as 10 AM EST.

Looking at the data issued by the International Bank of Settlement, more than 90% of the trading volume in the currency markets involves these six currency pairs. This makes these five hours the most volatile five hours in the forex market 24 hour day.

These are the most active five hours primarily because of the overlap between the United States, the United Kingdom, and the European currency markets.

What you need to do is to have the international economic news calendar that gives you the times and dates of the significant financial news releases that are scheduled by the European Central Bank (ECB), the Bank of England (BOE) or the Bank of Japan (BOJ).

You must be aware of this fact that the US Dollar and the Gold Prices are negatively correlated. So, when one moves up, the other moves down. Right now, gold is moving up, so USD is expected to step down.

Gold prices and oil prices tend to show correlation with several currency pairs. So, keeping an eye on these different markets can help you understand how the trends are going to be affected in the currency market. During these five hours, new trends can get started in the above six major currency pairs. These five hours are always keenly watched by experienced currency traders.

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