Time of Forex market activity is one of the most important issues for a trader. Successful traders use those time periods wisely. They don't sit in front of their charts for 24 hours a day. If you get tired of staring at price charts you spending too much time at your computer. You need to utilize the market schedule more wisely.
Red eyes swollen face and other signs of continuous sitting in front of the monitor do not indicate success in trading currencies. Professional trader knows when to watch the charts on his monitor and when to be away from his computer.
No one became rich by trading in an exhausted state. Clear mind and alert state are necessary for making right trading decisions. Then when we should be trading and when taking the rest?
According to my experience there are times during the day when you can trade profitably. Hopefully my advise will help you to schedule your time and get rid of tiredness. I must note that any time which is mentioned here is for US eastern time zone. So make your adjustments to your time zone.
Market During Asian Session
Time period from 5 pm until 11 pm is called Asian session. It's time of Japanese traders. In this period the most powerful countries that active are Japan, China and Australia.
Trading during this time is not very active. Most currency pairs are not too volatile. European and American financial institutions are closed for the night. There is almost no price movement for major currency pairs. There are some exceptions though. For example important economic news releases in Japan can make some currencies more volatile.
It is possible to scalp the market during Asian session. Personally I don't like scalping. It takes too much time and very little return. Also broker's spread can ruin all your scalping profits. Therefore I would suggest to place a stop loss on any open order and leave your charts.
The next two hours 11 pm -1 am (EST) are market's slower time period. Traders in Asia are ready to go home. Probably the best choice to trade during this time would be any currency pair that has Japanese Yen in it, for example GBP/JPY or EUR/JPY.
Trading During European Session
When Asian session closes the following time period is one of the most important ones. Now it is time for European banks and traders to come into play. Since they can define the trend for the rest of the day it is important to look at this time period.
For anyone who wants to trade European session my advice would be to watch market carefully. During this time there is a high probability to find a good trading opportunity. At 4 am until 5 am (EST) be aware of important financial news releases.
Time frame from 4:30 am until 6 am is time when London financial institution and traders are most active. Usually around 5 am, 6 am British economic news can be released. The best currency pairs to trade in this session are crosses with Euro and British pound.
NY Trading Session
The most active time in Forex market is the morning of the New York session. We have overlap of European session with the New York open therefore the volatility is probably the highest during the day. The World's largest banks and financial institutions are active during this time.
Being the most active trading period NY session gives many high probability trading opportunities. Therefore many day traders like to trade during this time only. Many fundamental news releases that can move the price dramatically happen during 8:30 - 9 am. This activity goes away in afternoon around 1-2 pm.
After 2 pm the activity decreases even more, except for the days of Federal Reserve news releases. Usually it happens at 2:15 pm. That may or may not increase the volatility of the currency pairs.
From this information you can easily see that there is no need to spend 24 hours a day waiting for trading opportunity in front of your charts. It's enough to pick one active period in the market to catch a good trading opportunity. This is a way to successful trading in Forex.
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Albert Schmidt is a successful trader in Forex market for a few years by now. Learn more about how he can help you to learn to trade currencies at his website about Forex trader e-course.
