Trading in the Forex Market : The 3 Sessions
The Forex market is open 24 hours a day from Sunday to Friday evening (Paris). On the other hand, even if one can trades without interruption, it is worth noting that it is better to invest in the 3 sessions of the main financial centers, namely: (approximately)
- The Asian session – from midnight to 9 am
- The European session – from 8 am to 5 pm
- The American session – from 1 pm to 10 pm
However, we can see that the Asian and European sessions overlap between 8 and 9 am and the European and American sessions overlap between 13 and 17h. Thus during these periods the volumes are supposed to be the most important, since the traders of the different financial places are present at the same moment.
These periods are important as trading volumes are assumed to be at the highest level as more traders from different financial markets are present at the same time.
Should we trade on certain days of the week and not others?
Can we think that there are better days than others to trade? In fact, Tuesday, Wednesday and Thursday have more volatility compared to other days of the week. This does not mean that we should not trade on Monday and Friday, but due to portfolio adjustments at the beginning of the week and profit taking on the weekend, these two days are often more delicate. It should also be noted that a majority of the macroeconomic figures generally come out between Tuesday and Thursday, with the exception of the extremely important figures that come out every 1st Friday of each month: the NFP and unemployment rates in the United States.
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