Forex trading is a global decentralized market used for the trading of currencies. Forex trading is operated online and one of its main advantages is the flexibility of trading times or working hours. This is because the currency market does not have a ‘closing time’. It is open and accessible 24 hours and 5 days a week. In Nigeria, the currency market opens on Sunday at 11:00 PM and closes on Friday at 10 PM. Every day of the week, there is always one country currency market country around the world that is open to business. Forex trading takes place in various countries around the world and as one market is closing for the day another is opening for business. This is why forex trading is referred to as a 24 hours currency market. It is crucial for a forex trader to know the forex trading hours for the various forex markets so as to determine the best times to trade during the day. Every forex trader will come to realize that some hours and days of the week present better trading opportunities and more profits than others. This is why it is important to know the best times to trade forex in Nigeria.
Read on below:
What Time Should You Trade Forex in Nigeria?
It is true that the forex market is open 24 hours a day, however, not all trading hours and sessions have equal opportunities. In order to be successful in the forex trading business, you must understand the trading sessions according to Nigeria time, how each session works and the best currencies to trade with at each session. Different countries have their own forex trading times because the international forex market is connected by a network of computers. When the trading session for one country closes, it does not mean that the entire international forex market has closed. For example, if the Asian market closes, the Japanese yen (the Japanese currency) can still be traded on other exchanges around the world.
The best forex trading time
The best time to enter the market to trade is when the markets of several countries are opened at the same time. That way, large volumes of currencies will be traded.
Global Forex Trading time
While each country has differing trading times, forex trading in each time zone is traded 8 am to 4 pm. The duty of every forex trader is to then find out when the markets of these different countries overlap so as to get the best forex trading times. When forex trading times overlap, there is more activity as rates start to fluctuate which holds chances of greater profits. Asides from market overlap, it has been observed by trading experts mid days of the week experience more activity and trading than other days. Middays to include Tuesdays and Wednesdays.
Best Forex Trading Time in Nigeria
The best time to trade forex in Nigeria is between 2:00 pm and 6:00 pm, according to Nigeria local time. At this time, the London and the New York trading sessions start to overlap, bringing with it lots of market activities and opportunities. London and New York markets are the two largest trading sessions in the world, hence their overlap means liquidity at its peak. Both markets continue to overlap for four hours, 2 p.m to 6 p.m. This four-hour period is a great opportunity to make quick profits since the difference between the selling and cost price will be at an all-time low of the day. Also, a lot of trade-able patterns form during this period. Those who trade during the day can enter the market at this time to get as many profits and close when the New York trading sessions close at 5 a.m or 6 a.m according to Nigeria local time.
The global forex market can be divided into three sessions. These are three major financial hubs in the world – The Asian Session, European Session and the American session. Each of these sessions has its opening and closing hours. The forex trading markets function when these three sessions are in business. In fact, financial institutions such as banks and corporations conduct their major transactions when these three sessions are in business. Below is a schedule of the three major trading sessions in the world according to Nigeria local time.
Asian session- 12.00 a.m to 9.00 a.m
The Asian forex market accounts for about 20% of the daily forex trading volumes around the world. The major participants in the Asian market are traders from Japan, Australia, Hong Kong & Singapore. The Asian market is open from 1.00 a.m to 10.00 a.m. It then overlaps with the last hour of the Tokyo session and the first hour of the London session.
(European Session) London session- 8.00a.m to 5.00a.m
The London session is the largest financial market in the world, contributing to about 37% of the total forex trade turnover in a day. The London market opens at 8:00 a.m and closes at 05:00 p.m (Nigerian Time). The opening of the London session is a perfect time to make profits as liquidity is highest and lots of breakouts and trends occur. The European session overlaps with the New York session for three hours.
New York session – 2.00p.m to 11.00p.m
New York market is the second-largest session in the world, contributing to about 18% of the total daily forex trading turnover. Major participants in this session are traders from America and Canada. The forex market in New York session is open from 02:00 PM to 11:00 PM (Nigerian Time). The New York session overlaps with the London session from 2 p.m to 6 p.m. This is the most liquid period of the day where big, fast moves are visible and many traders make the most profit.
The best time to trade forex in Nigeria is during the overlap of the London and New York session, 2.00 p.m and 5:00p.m Nigerian time so as to make profits from high liquidity and price movements.