Although the forex market operates 24 hours a day, it is not always suitable for entry. For professional traders, instead of trading all day, they will only choose the time when the market is most exciting or wait patiently for the price to reach the desired point before starting to open the appropriate positions. In contrast, new traders often ignore this, almost always sleep with the market, enter orders anytime and anywhere in the hope of making more money. However, even though the frequency of large orders, the returns are not much, even loss due to choosing the wrong trading time.
Therefore, to minimize risks, trade when the market is vibrant or choose the trading time frame that suits you best. In the following article, we will go together to find out the trading sessions in forex, as well as how to choose the right currency pair for each given time frame.
Uptime forex market during the week
The forex market is an over-the-counter (OTC) market, operating 24 hours a day and 5 days a week, trading on Saturdays and Sundays only.
When the economy operates, the central banks need to regulate monetary policy, commercial banks need to trade USD, JPY, ... to serve business and investment activities, businesses need to buy and sell. foreign currencies for production and business, etc. Therefore, the trading of currency pairs takes place all over the world financial centers, in many different trading time frames.
When Asians go to sleep, Americans are active, when Americans rest, Australians conduct transactions, just like that, the forex session is closed, the other forex session opens again, forming a round. closed.
The special thing is that each trading time frame has a unique feature and it will tell you many interesting things.
Daily sessions in Vietnamese time
In one day, there will be 4 main trading sessions, located at the leading financial centers of the world including: Sydney (Australia), Tokyo (Japan), London (UK) and New York (USA). Each session lasts 9 hours, when this session ends when the next session is active.
Australian Session (Sydney)
This is the dawn trading session in Vietnam and is also the first major session on Monday, starting a new forex trading week.
Due to the nature of the climate in Australia, the summer-autumn working hours (April to October) will be adjusted differently than the winter-spring (October to April next year).
Accordingly, in the summer, trading hours in Sydney are open at 5am and end at 14h in Vietnam. In winter, the trading hours in Sydney are open at 4am and end at 13am in Vietnam.
As such, the forex market will open on Monday at 4am (summer) and 5am (winter) in Vietnam.
This session is also known as another Pacific session and in fact this trading time frame is also quite "peaceful". The market is usually quiet and not volatile early in the morning in Vietnam. The session takes place in Australia so the AUD (Australian Dollar) will be heavily traded, if you want to trade at this time frame then you should choose AUDUSD or NZDUSD. Other pairs during this time usually have low liquidity and less volatility.
Asian session (Tokyo)
The Tokyo session is also known as the Asian session, opening after the Australian session. There is no difference between summer - autumn and winter - spring trading hours. This session opens at 6am and closes at 3pm in Vietnam.
It can be seen that most of the trading time in Tokyo coincides with Sydney's time frame. Therefore, when the Tokyo session opens, the market will become more exciting than before, the AUD will be traded more. Besides, of course the JPY (Japanese Yen) will also receive great attention. It is an opportunity for you to consider trading currency pairs with JPY such as USDJPY.
In general, in the morning in Vietnam, the forex market will be quite quiet. The ideal currency pairs you can choose to trade during this time frame are those with AUD and JPY.
European session (London)
The London trading session opens a very exciting trading period of the day because in Europe, the amount of money flow is very large.
Like Australia, European working hours in winter are one hour later than summer. Accordingly, the London session operates from 14h - 23h in summer - autumn and 15h - 24h in winter - spring.
When the London market is active, the Tokyo market is going into the last minutes of trading. Intraday traders in Asia exited orders while European traders entered orders causing prices to move upward.
Different from the morning, the trading volume in the afternoon in Vietnam time is huge. If you enter the order, within a short time you may find yourself quite profitable. To trade during this time, we can choose currency pairs with EUR (Euro) or GBP (GBP) to trade such as EURUSD, GBPUSD for example.
US session (New York)
The forex market will explode when the US session begins. The developments in this trading frame will often be quite fierce. The US session runs from 19h to 4am the next morning in the summer and 20h to 5am the next morning in the winter, according to Vietnam time.
As such, the forex market will close on Saturdays at 4am (summer) and 5am (winter) in Vietnam.
Important economic news is also often published at the beginning of New York session, causing big market fluctuations.
Many Vietnamese traders who have free time in the evening will enjoy this session.
The best time frame for trading the currency pairs of the day
Through the above sharing, you may also notice that if you want to trade in a quiet market, you can choose the Sydney session and the Tokyo session, ie the morning until about early afternoon in Vietnam. However, keep in mind that we cannot make a profit if the market stands still. Therefore you should trade currency pairs like AUDUSD, NZDUSD, USDJPY within this time frame.
If you want to take advantage of big market fluctuations, choose the European and American sessions. Pay special attention to the time between 19h - 23h for summer and 20h - 24h for winter, calculated according to Vietnam time. This is the time of the London session and the New York session together, leading to a very high trading volume. As a result, the market will move quickly, creating opportunities for quick profit. For example, in the morning in Vietnam time, the AUDUSD pair takes 4 hours to move 20 pips, in the evening in Vietnam time, the EURUSD pair can go up to 30 pips and then go down to 50 pips within 1 hour for example.
Below is a chart illustrating the fluctuation range of EURUSD at the above time frame. You can see that the currency pair moves more pips at 8 am - 12 pm ET time, which is about 20 pm - 24 pm Vietnam time.
You need to pay attention to the times during which the sessions overlap. That is when the market has very high liquidity, the transactions take place vibrantly, the market has enough buying and selling forces to make prices move quickly and sharply. If the transactions are correct you can make high profits in a short time. However, that means you also have a greater risk, so when trading in European and US session time periods at the same time, you need to pay attention to the order volume and leverage of yourself to be able to offer reasonable deals.
Best time to trade during the week
Not only the trading frameworks of the day make a difference, but each day of the week also has its own characteristics. Usually if there is no news, the market on Monday will be fairly flat compared to other days. The market will become more exciting on Tuesday, Wednesday, and Thursday. By Friday, the market will still be vibrant but it is only about the first half of the day because traders will usually exit orders and prepare for the holiday. weekend.
We hope that through this article, you have understood the operating time of forex trading sessions of the day as well as the characteristics of the days of the week. From this knowledge, you can build yourself reasonable habits and trading strategies that are right for you. Good luck!
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Author: Tin Nguyen
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