Your toolbox Forex market time zone converter

The Forex markets are global, and therefore a 24-hour situation that moves fluidly. The markets aren’t always the same though, so it is important to understand who is online, and more importantly – how liquidity is in the market. The markets will sometimes be more likely to move, if there are more participants. The London market is the busiest, as the largest traders tend to be in that city, or at least the time zone.

The second busiest market is the North American market, or “New York session.” The busiest time of the day is typically the convergence of New York and London. This will have the largest funds in the world trading at the same time, meaning that the liquidity is highest.

Asian markets are the least liquid, meaning that the least amount of volume is traded when those are the markets in control. The Asian markets can move violently as well as the other ones, but typically won’t be as likely. The other problem that you can run into is the larger spreads that the markets will have. The trading session in the middle of Asia can often feature little in the way of volatility, and larger spreads. In contrast, the average day trader will often prefer the European (London) session, as the spreads are smaller, and the liquidity higher. It really comes down to the strategy that you are using, and the timeframe that you are interested in.

Longer-term traders typically don’t care as much about these things, but the short-term trader should pay attention. By using a Forex market time zone converter, you can see which markets, and by extension banks, are open and trading. The more markets that are open, the better the trading conditions, especially for you day traders. There are a lot of free tools on the net, but in this example, I am using this one: http://forex.timezoneconverter.com

Your toolbox Forex time zone converter