The Forex Market Hours
Forex trading can be done almost 24 hours a day, 5 days a week. We say “almost” because you cannot place trades for a few minutes every day at rollover time (5 pm New York time).
The duration of rollover depends on the broker you use, but it’s usually between 2-5 minutes. Close to rollover time, the spreads on different currency pairs can be much wider than usual. This makes trading close to rollover time impractical and risky, especially if you use a tight stop loss.
How late does the Forex market open and close?
There are 4 main Forex trading sessions, the Sydney session, the Tokyo session, the London session, and the New York session. The Forex market opens every Sunday at 17:00 New York time and closes every Friday at the same time. We use New York time as our benchmark because the market open/close is always around 17:00 in New York. 17:00 New York time is the end of the US session; during the Zambian winter, it is also the start of the Sydney session. In the Zambian summer, there is a two-hour overlap between the Sydney market open and the New York close.
During the Zambian summer, when the New York session closes at 19:00 EST, it is (01:00) in Zambia. When it is summer in the northern hemisphere, and the New York session closes at 17:00 EDT, it is Midnight (00:00) in Zambia. So, in Zambia, the Forex market opens and closes at either 00:00 (roughly between March and November) or 23:00 (roughly between October and March), depending on the time of the year.*
As you can see in this table, the best time to trade Forex is generally between 11:00 and 20:00 EAT (East Africa Time) in the summer and 10:00 and 19:00 EAT in the winter.
In the summer, 11:00 EAT is when the London session opens, and 16:00 is when the New York session opens. Between 11:00 and 16:00 is a good time to catch important economic news releases, which can greatly impact exchange rates. During these hours, the Tokyo session overlaps the London session, and a few hours later, the London session overlaps the New York session.
There is often big market participation and good volatility when the London session opens. Likewise, the open of the New York session brings immense trading volume to the market. During these hours, intraday traders have the best chance of getting enough market movement to hit their profit targets. False moves (e.g. fakeouts) are also less common than during the first few hours of the Tokyo and Sydney sessions. Liquidity is also very high, meaning that large positions can be easily absorbed by the market, with a smaller chance of experiencing slippage or significant market impact.
The table above is calculated from East Africa Time. In the Zambian summer, the London trading session starts at 11:00 EAT while the New York session opens at 16:00. After the transition from EST to EDT in March, the London session opens at 10:00 EAT and the New York session at 15:00. It is important to know this because many traders start trading when the London session opens or when the London and U.S. sessions overlap.
Although we can say that the Forex market is generally open from Sunday at 17:00 EST/EDT to Friday at 17:00 EST/EDT, we can also say that it closes every day for a few minutes from Monday to Thursday at 17:00 EST/EDT for rollover. Soon after the rollover, the Sydney trading session starts, and the cycle is repeated. Of course, rollover also takes place when the market closes on Friday.
Conclusion
Although the Forex market can be traded 24/5, the best market liquidity, volatility, and trading conditions are generally experienced during the crossover between the London and early US sessions. During these sessions, some of the most important central banks, speculators, businesses, financial institutions, commodity markets, and stock markets are active, all of which can have a huge impact on the currency markets.
When the Forex market is most active, spreads are usually low and large orders can be executed effectively. Market movements are also generally more reliable and forceful than during less active market times.
To learn more about the best times to trade Forex, check out our episode on the subject:
