The forex markets are open 24 hours for 5 days a week (Mon-Fri) as per IST (Indian Standard Time) and you can trade any time using the forex trading app. But, you can’t expect all hours of the day to be profitable. Because in the forex market, profitable hours are considered when currency pair prices are highly volatile.
High volatility happens when more people are actively betting on currency prices. In high volatility, the prices change constantly to provide you with better chances for quick gains.
Let’s understand how trading forex at active hours is profitable.
Firstly, as you know, a profitable trade is a trade that brings you more pips. And during the active hours, when currency prices constantly go up and down increases the chances of getting more pips than in the “quiet” hours. Quiet hours are when prices are less volatile.
For example, in GBP/USD pair traded has the highest volatility within the first hour of market opening (see the snapshot below). You can see 0.50% volatility as compared to 0.14% which is the average volatility in GBP/USD pair.
This could be the best time to gain profit from GBP/USD trade.
Secondly, the high asset liquidity during active hours results in tighter spreads (reduced transaction costs) that you have to pay to the broker. Spreads are tighter (low) because more people are trading and the transaction costs are divided among more people.
Let’s discuss the best time for forex trading in India in detail. We have discussed 2 types of timings best for forex trading in India –
- Exchange wise best time – When top exchanges are operational
- Trading session overlaps – When trading sessions of these exchanges overlap
Best Time For Forex Trading in India (Exchange-Wise)
#1. London Stock Exchange
Market Open Time: 01:30 PM to 10:00 PM IST
London Stock Exchange dominates the forex trading market with 43% of global trading volume as per the Bank for International Settlements (BIS) report.
You can trade in the London stock exchange because you not only get major activity here but you also don’t need to wake up late if you trade in the NY stock exchange that starts at 7 PM IST.
The currency pairs that you can trade are – (EUR/USD, GBP/USD, USD/JPY, and USD/CHF)
#2. New York Stock Exchange
Market Open Time: 08:00 PM to 1:30 AM IST
New York stock exchange is the second largest forex market with around 17% of currency trading happening here.
Since the US dollar is involved in 90% of trades, you can get high activity if you want to trade in US-based currency pairs like EUR/USD, GBP/USD, USD/JPY.
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#3. Tokyo Stock Exchange
Market Open Time: 5:30 AM to 11.30 AM IST
Go with the Tokyo stock exchange if you want to trade primarily in the 2 currency pairs mentioned below –
- USD/JPY (U.S. dollar vs. Japanese Yen)
- GBP/JPY (British Pound vs. Japanese Yen)
The 3rd highly traded forex pair in the Tokyo stock exchange is GBP/CHF (British Pound vs. Swiss Franc).
You have a good chance of liquidity as the Tokyo stock exchange trades 6% of global forex trading.
The Tokyo stock exchange is highly impacted by the news coming from China.
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#4. Sydney Stock Exchange
Market Open Time: 5:30 AM to 12.30 PM IST
If you want to trade in Australian dollar pair, then try your luck in the Sydney stock exchange that opens identical to the Tokyo stock exchange at 5.30 am IST.
You can see heavy movement in AUD, JPY, EUR, GBP to the USD currency pairs.
Overlapping sessions are the best time to trade in forex that you’ll understand in the next section.
Let’s have a look at the timings of major global forex exchanges as per Indian Standard Time in the next section.
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Global Forex Exchanges Timings as per Indian Standard Time (IST)
| Region | Opening Hours (IST) | Closing Hours (IST) |
| Sydney (Pacific session) | 05:30 am | 12:30 pm |
| Tokyo (Asian session) | 05:30 am | 11:30 am |
| Hong-Kong and Singapore (Asian session) | 07:00 am | 01:30 pm |
| London (European session) | 01:30 pm | 10:00 pm |
| New York (North American session) | 08:00 pm | 01:30 am |
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Best Time For Forex Trading In India (Trading Session Overlaps)
The best time for forex trading is when the market is most active because you get the tightest spreads and better chances to execute a trade at desired levels.
The forex markets are most active when the market hours overlap between two different sessions because the number of traders buying and selling each currency increases at that time.
Let’s have a look at three overlaps that happen every day –
| New York and London exchanges overlap | 6.30 pm to 9.30 pm (IST) |
| Tokyo and Sydney exchanges overlap | 5.30 am to 12.30 pm (IST) |
| London and Tokyo exchanges overlap | 1.30 pm to 2.30 pm (IST) |
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Final Thoughts
So, the best time to trade forex depends on the currency pair you want to trade.
The thumb rule is, each currency pair is highly liquid when the local exchange sessions for the pair overlap, which means that both exchanges are operational at the same time. For example, if you want to trade in GBP/USD, you will get a higher trading volume when both London and New York sessions are open.
Remember, high trading activity also leads to high volatility. While the volatility creates opportunities for profit-making but it may also lead to huge losses if your trading strategy is flawed. So be technically strong before diving into forex trading.
Best he sir
nice information