Benefits of a 24 Hour Forex Market

One of the main attractive factors when you learn Forex trading is that it is traded 24 hours a day for 5 days a week due to its global participants. No longer are traders who work 9-5 for a living unable to invest and trade actively. Traders can quite literally trade Forex for 10, 20 or 30 minutes a day. This means that the week starts when the markets open in Australia and close when the markets in the USA close on a Friday.

As the market is open 24 hours a day it also gives traders the unique opportunity to react to news events immediately rather than having to wait until the markets open in the mornings. In Forex all news is visible to all participants for free and everyone is on the same playing field.

Admittedly those who subscribe to professional newswires may get the news faster or more reliably but there is no insider information or city professionals knowing something other traders don’t.

Despite the Forex markets being open 24 hours a day during the working week, it does not mean that it is suitable for trading 24 hours a day. At certain times of the day there are two or more trading zones (zones are USA, Europe, UK etc) that overlap. At other times of the day there is just one trading zone active - as an example, Australia pre-Japan open. This means that at certain times of the day there are more market participants and so therefore there is more volume in the markets. It is when these high volumes are in process that traders have the best chance to see the greatest movements and making profit. Less volume gives little chance of price movement and so therefore less chance of profit. This is why you must be confident that the strategies you have learnt in your Forex trading training do work and may be affected for a while simply because of market conditions such as volume.

Which times are the best to trade?

As discussed, the best time to trade foreign exchange is when two or more countries overlap. For example:

New York and London - from 8.00 EST to 12.00 EST
Sydney and Tokyo – from 19.00 EST to 2.00 EST
London and Tokyo – from 3.00 EST to 4.00 EST

Whilst it is fact that some trading times are better than others when you learn Forex trading, the fact still remains that any time; 24 hours a day, 5 days a week; traders are able to react to the market conditions. Positions can be entered or closed out as you and the markets require.