Understanding Forex Market Hours to Maximise Profits

Discover how to leverage the different Forex session hours to your advantage in the London, New York, and Tokyo markets: here are some useful tips to start trading.

The Forex market never sleeps, as it operates 24 hours a day across various sessions in the world’s major financial centres.

For five days a week, online traders have the opportunity to trade in the London, Tokyo, and New York markets continuously, taking advantage of the most profitable times of the day to seize the best earning opportunities.

The overlaps between the session hours of different markets (Asian, European, and American) result in significantly different trading volumes at various times of the day, leading to substantial variations in liquidity and price volatility.

Understanding the characteristics of various international markets and which trades are most profitable depending on the market hours exponentially increases the chances of making profits in Forex for beginner and intermediate traders.

How to Leverage the Best Forex Market Hours

If you’re wondering how to start trading, know that one of the most effective strategies to begin earning is to understand the hours of the various market sessions held around the world, to grasp the opportunities offered by the overlapping hours between different cities.

First, it’s important to understand that each Forex market has its own characteristics, which also stem from the number of people trading in it at any given time.

For example, the London Forex session is one of the busiest in the world in terms of trading volume, due to the importance and tradition of this financial centre. This results in significant liquidity, making trades on currency pairs like EUR-GBP and GBP-USD (i.e., euro/pound and pound/US dollar) easier.

At the same time, the high price volatility in the London session opens up continuous profitable investment opportunities, especially in the afternoon hours when the European market overlaps with that of New York.

The Tokyo session, on the other hand, has lower volatility, suggesting to beginner traders a different type of trades from those in the European market. An exception is the closing phase of the Japanese session, as it overlaps with the opening of London, often offering a peak in both liquidity and volatility.

Additionally, market news from influential sources (such as decisions by institutions like the Bank of England) can arrive at any time to disrupt the current situation, reverse ongoing trends, and create new earning opportunities. Therefore, it’s crucial to always stay informed about Forex market news.

Overlapping Hours in Forex Markets: the best strategies

The best Forex strategies for a beginner or intermediate trader naturally depend on the country in which they operate. For example, a trader in Japan might be attracted to the overlapping hours between the London session (which runs from 08:00 to 17:00 GMT) and the Tokyo market session (from 00:00 to 09:00 GMT).

At the opening of the Asian market, the overlap with European hours causes a moderate peak in price volatility, often making breakout trades profitable. These are trades that bet on the continuation of an upward or downward trend (known as trend-following), as in such contexts, trends are usually able to break previous resistance or support levels.

In contrast, a trader operating in India will find it beneficial to take advantage of the high trading volume in the New York afternoon session, while traders from Nigeria, due to time zone alignment, prefer to trade in the London session.

The latter, marked by sudden price variations, suggests the use of tools highly valued by intermediate and beginner traders operating online, such as Stop Loss and Take Profit. With these easy-to-use tools, it’s possible to capitalise on buying or selling investments by exiting the position at the right moment, before sudden price increases or decreases undermine the trade’s profitability.

Thus, the overlapping hours between various sessions represent a fantastic earning opportunity for traders. Consider, for instance, the New York market (from 13:00 to 22:00 GMT), which, when coinciding with the European session, tends to stabilise prices, reducing spreads and making variations more predictable.

With STIC Cashback, You Get Advantageous Refunds to Leverage Different Forex Sessions

If managing the best Forex market hours allows a trader to place a high volume of trades at certain times of the day to boost their chances of making profits, it’s clear that a tool like Forex Cashback is incredibly useful and highly advantageous.

Trading Cashback, in fact, offers periodic refunds based on the volume of trades carried out. This means that when you decide to open a large number of positions to capitalise on the best Forex market hours, using a programme like STIC Cashback, you can receive a Forex rebate that enables you to manage your budget even more profitably.

Start optimising your trading programme today with STIC Cashback and discover the true power of Forex market timing!