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.
It is not realistic to be successful in anything if you are constantly tired. You need to have a fresh and clear mind in order to see a trading opportunity and make profit. So, how should you schedule your time around trading Forex?
I have a couple suggestions for you. It is based on my experience. I hope it can help you to schedule your time for trading currencies. I always use US Eastern Time which is GMT-5, therefore you need to make necessary adjustments for your time zone.
Asian Forex 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.
You can do scalping trades during this period. However in my opinion it's not worth it. So if you have any open position make sure you placed stop loss order and go do something else besides trading in Forex.
The following couple of hours 11 pm - 1 am are usually the slowest time in the market. Even Asian financial institutions and traders are getting ready to go home. If you do decide to trade during this time the best currency pair to watch is any cross with Japanese Yen: GBP/JPY, EUR/JPY etc.
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.
If you do decide to trade during this time I would advise to follow the market very closely so you wouldn't miss a good trading opportunity. Between 4 am and 5 am there can be important economic news releases. That's the time when market presents good opportunities.
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.
Since it is the most active time I recommend to trading during this time frame if you are a day trader. Some people trade only during the New York session and do very well, because big moves happen in this session. Almost all important news are being released at 8:30 am. You want to watch closely this point in time if you don't want to miss a trading opportunity. Around 1 pm - 2 pm the market activity slowly fades away.
After that the volatility of the currency pairs gradually slow down. There can be news releases from the Federal Reserve. It comes around 2:15 pm. Sometimes it can affect the volatility in the market.
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.
Albert Schmidt has been in the field of Forex Trading for quite some time by now. He maintains a website about Forex trading where you can find answers to the rest of your questions about how you can learn Forex trading.
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