Foreign exchange (forex) market hours are the specified periods of time when traders and investors are able to conduct transactions in the foreign exchange market. The forex market is open 5 days a week and closed during the weekend.
These international currency markets are vital to facilitating business across the globe and are made up of banks, commercial companies, central banks, investment management firms, and hedge funds, as well as retail forex brokers and investors.
Key Takeaways
Forex market hours are the hours when markets for forex trading are open.
The forex market is available for trading 24 hours a day except on weekends.
The forex market is decentralized and driven by local sessions, and four in particular—Sydney, Tokyo, London, and New York.
Trading volume varies from one session to another, although the highest trading volume tends to occur when the London and New York sessions overlap.
The benchmarkspot and forward exchange rates, used for daily valuation and pricing by many money managers and pension funds, is set at 4 p.m. London time.
Understanding Forex Market Hours
Forex market hours are the hours during which forex market participants all around the world can buy, sell, exchange, and speculate on global currencies. The forex market is open 24 hours a day during weekdays but closes on weekends.
Because this market operates in multiple time zones, it can be accessed at any time except for the weekend break. With time zone changes, this break gets squeezed.
The forex market opens on Sunday at 5 p.m. local time in New York City. It closes on Fridays at 5 p.m. and resumes trading again 48 hours later to begin a new week. When the market is open, traders all around the world can execute trades in the forex market. Trading conditions may vary depending on what session you're operating in.
The international currency market isn't dominated by a single market exchange. It involves a global network of exchanges and brokers around the world.
Specific Sessions and High-Volume Hours
Forex market trading hours are based on when trading is open in each participating country. While time periods overlap, it is generally accepted that the following periods are the most active for each region:
New York: 8 a.m. to 5 p.m. (EST)
Tokyo: 7 p.m. to 4 a.m. (EST)
Sydney: 3 p.m. to 12 a.m. (EST)
London: 3 a.m. to 11 a.m. (EST)
The chart below shows the actual hours that markets in each region are open in the global standard UTC time, and where those sessions overlap.
The two busiest time zones are located in London and New York. The period when these two trading sessions overlap (London afternoon and New York morning) is the busiest period. It accounts for the majority of volume traded in the day, with trillions of dollars in value changing hands.
It is during this period that the WM/Reuters benchmarkspot and forward foreign exchange rates are determined. The rates, which are set at 4 p.m. London local time, are used for daily valuation and pricing by many money managers and pension funds.
Forex trading starts in New Zealand but is called the Sydney session.
Special Considerations
Most Popular Currencies
While the forex market is a 24-hour market, some currencies in several emerging markets are not traded 24 hours a day.
The seven most traded currencies in the world are the U.S. dollar, euro, Japanese yen, British pound, Australian dollar, Canadian dollar, and Swiss franc. All trade continuously while the forex market is open. Speculators from all over the world typically trade forex in currency pairs involving these seven currencies and favor trading times with heavier volume.
High Volume and Pricing Efficiency
When trading volumes are heaviest, forex brokers will provide tighter spreads (bid and ask prices closer to each other), which improves pricing efficiency and reduces transaction costs for traders.
Likewise, institutional traders also favor times with higher trading volume, though they may accept wider spreads for the opportunity to trade as early as possible in reaction to new information they have.
Despite the highly decentralized nature of the forex market, it remains an efficient transfer mechanism for all participants and a far-reaching access mechanism for those who wish to speculate from anywhere on the globe.
What Are the 4 Forex Trading Sessions and Times?
In Coordinated Universal Time (UTC), they are 7 a.m. to 4 p.m. (the London market), 1 p.m. to 10 p.m. (the New York market), 9 p.m. to 6 a.m. (the Sydney market), and 12 a.m. to 9 a.m. (the Tokyo market.
What Time Does the Forex Market Close in the U.S.?
In local time (EST), it closes at 10 p.m. every day except when it's closed for the weekends. When taking all regional sessions together and using UTC time, forex trading begins in New York at 5 p.m. Sunday and closes at 5 p.m. Friday.
What Is UTC Time?
UTC is short for Coordinated Universal Time. It's the 24-hour time standard for civil time throughout the world. It officially replaced Greenwich Mean Time in 1967.
The Bottom Line
The forex market is open for certain hours during sessions in participating countries. When taken together, these market hours allow for 24-hour trading, five days a week. The forex market is closed during the weekend.
The forex market is open 5 days a week and closed during the weekend. These international currency markets are vital to facilitating business across the globe and are made up of banks, commercial companies, central banks, investment management firms, and hedge funds, as well as retail forex brokers and investors.
Let's start with a brief explanation of the 24-hour forex trading cycle. The forex market operates around-the-clock, five days a week, thanks to its global nature. This continuous cycle encompasses four major trading sessions: Tokyo, London, New York, and Sydney, each with distinct characteristics.
Stock and commodities markets are open for a limited amount of time each day, typically not even a full 8 hours. But the global Forex markets are open and trading 24 hours a day, from Monday to Friday. The FX market does take a break over the weekend however, so you could say that it trades 5 days a week.
The number of trades an active Forex trader makes per day can vary widely depending on their trading style, strategy, and risk management plan. Some traders may make only a few trades per day, while others may make several dozens. On average, a short-term, active trader might make between 2 to 10 trades per day.
You're generally limited to no more than three day trades in a five-trading-day period, unless you have at least $25,000 of equity in your account at the end of the previous day.
Your account will be flagged for pattern day trading if you make 4 or more day trades within 5 trading days, and the number of day trades represents more than 6% of your total trades in that same 5 trading day period. This rule only applies to margin accounts and IRA limited margin accounts.
The weekly rule system is a trend-following trading system. One example of the system is the four-week rule (4WR). Traders will buy when prices reach a new four-week high or sell when prices reach a new four-week low. The weekly rule trading system was established by Richard Donchian.
The 7-day moving average for a given time is calculated by adding the closing stock prices for the given number of days (represented by n) and dividing the sum by n. If you want to calculate Day 1's average, you need to average out the prices for the last seven days.
Given these factors, some currency traders achieve consistent profitability within a few months, while others may take years. The key is to focus on continuous learning, adapting to market changes, and staying patient and disciplined throughout your trading journey.
The opening period (9:30 a.m. to 10:30 a.m.Eastern Time) is often one of the best hours of the day for day trading, offering the biggest moves in the shortest amount of time. A lot of professional day traders stop trading around 11:30 a.m. because that is when volatility and volume tend to taper off.
A full-time job in forex trading is possible, but it takes commitment, discipline, and skill mastery. In addition, although forex trading has many benefits, such as reduced costs, flexibility, and possible profitability, it's important to recognize the risks and difficulties it entails.
A $100 deposit is sufficient initial capital to open a forex trade in a real Forex account without breaking risk management rules. On average, traders with medium-level experience can earn over 10% of the deposit per month. Professional traders' earnings can exceed 500% a year.
For day traders, the 11am rule suggests that the period before 11 am EST is often characterized by heightened volatility and potential for trend reversals. This presents opportunities for traders to capitalize on short-term price movements.
A day trade is when you purchase or short a security and then sell or cover the same security in the same day. Essentially, if you have a $5,000 account, you can only make three-day trades in any rolling five-day period. Once your account value is above $25,000, the restriction no longer applies to you.
Forex trading can allow you to speculate on changes in currency prices in the global market. Forex can also help you diversify your portfolio and is available to trade 23 hours per day, Sunday–Friday, allowing you to respond to changes in global market conditions even when the stock market is closed.
In the United States, the primary stock exchanges are the New York Stock Exchange (NYSE) and the Nasdaq Stock Market. Both of these exchanges have regular trading hours, operating from 9:30 AM to 4:00 PM Eastern Time (ET), Monday through Friday (except on holidays).
This rule, set by FINRA, states that any trader who executes four or more day trades within a five-day period is considered a pattern day trader (PDT). PDTs must maintain a minimum equity of $25,000 in their margin account at all times.
Introduction: My name is Nicola Considine CPA, I am a determined, witty, powerful, brainy, open, smiling, proud person who loves writing and wants to share my knowledge and understanding with you.
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