Forex Currency
Timing is everything when trading the forex currency market. Part of knowing how to trade is learning to take advantage of the activities specific to various time periods. There are key elements that affect the outcome when you do your online trading, depending on the specific session when you are in the market. The sessions are defined by geography and time zones. Specifically we have the Asia-Pacific, European/London and North American sessions.
Asia-Pacific Session
Approximately 21% of the best forex trading happens in the Asia-Pacific session. The main forex currency exchange centers are Wellington, New Zealand, Sydney, Australia, Tokyo, Japan, Hong Kong and Singapore. New Zealand and Australia data reports are usually made public in the early hours of the day, which equates to early evening in North America. Japanese data is released between 7 and 8 pm. ET. Sometimes news comes out of Tokyo between midnight and 4 am ET. Obviously fx trading systems will be in full effect with currency pairs from those countries during the evening and the wee hours of the morning for traders in North America. Your trading signals can also be influenced by news from China related to changes to government policies and adjustments to interest rates.
Japanese data is very important to the market so the majority of the activity during this session is focused on Japanese yen currency pairs – USD/JPY, EUR/JPY and AUD/JPY. You’ll have adequate liquidity in the major currency pairs to use the strategies acquired from your currency trading course.
European/London Session
The European/London session overlaps with half the Asian trading day and half the North American session. In North America it takes place during the morning hours. It is responsible for at least 50% of the total global daily trading volume. Around 30% of global daily trading hinges on London. A forex currency trader can have some of the best results based on significant moves that happen during this period of trading currency.
The forex currency exchange rates are influenced by news and data being reported from countries such as Germany, France, Switzerland and the UK. Your trading system will have all “eyes” on currencies including EUR, GBP and CHP. Pay close attention to currency pairs such as EUR/CHF and EUR/GBP.
North American Session
By itself, the North American the forex currency trading session accounts for about 22% of the global daily trading volume but it is a significant time period due to the overlap with the European session. Similarly to futures trading some of the major moves in the market happen during the first half of the North American fx trade day. The morning is when key U.S. economic data is sprung on the world. This is when the forex currency rate regarding the value of the U.S. dollar is decided. Canadian data is also released first thing in the morning. There are other scattered reports that come out later in the day that impact forex currency trading systems.
Around noon Eastern Time, the European market begins to take a hiatus, but this is frequently preceded by a quick outbreak of activity. This is when certain trading strategies dictate exiting the market at a profit before the volume of liquidity falls off. Your forex currency broker can get involved in the scramble that happens at this time to capture some fast cash for your account. You can set this up yourself through your fx online trading platform. The fx forex trading day gradually winds down as time ticks toward the 5 pm., New York market close.
The best forex trading course teaches you about the tides of liquidity and interest in the market throughout the day. These tend to take place like clockwork based on the activities inherent in the three major global sessions. Even if you choose not to trade the forex currency market for what may appear to be “off” hours for you, at least schedule some hours coinciding with peak international trading to get a feel for it.
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