As the Forex market opens 24hours a day, it is not easy for traders to participate in all of the time zones and respond immediately every time. Therefore, timing is the most essential thing in foreign exchange trading.
To develop the most effective and time-efficient trading strategy, it is crucial to know how active market movements depending on the time zones. Only then you get as many trading opportunities as possible in the time zone you participate in.
In addition to liquidity, the extent of fluctuations in currency pairs also depends mainly on each country’s geopolitical locations and macroeconomic conditions. Thus, by finding out when the currency pair moves the most and when the least, the trader can increase his or her investment efficiency through efficient asset allocation. Let get started!
Asian Market (Tokyo FX Market)亞洲市場（東京外匯市場）
19:00 – 04:00 (東部時間 Eastern Time)
In Asian markets, foreign exchange trading is mainly carried out in certain financial centres. The Tokyo foreign exchange market, which accounts for a larger portion of the Asian time zone, is followed by Hong Kong and Singapore. Japan’s central bank’s influence in the foreign exchange market is gradually weakening, but the Tokyo foreign exchange market is still one of Asia’s most important foreign exchange markets.
Since this is the first major market opening among Asian markets, many investors use the Tokyo market as a trading momentum and a benchmark for measuring market dynamics in order to establish trading strategies. Sometimes trading in the Tokyo foreign exchange market is inactive. Still, large investment banks and hedge funds are known to operate important stop orders or options in the Asian market.
For risk-taking traders, USD/JPY, GBP/CHF and GBP/JPY are good choices. These currency pairs usually offer attractive opportunities of 90 per cent on average to traders who trade during short periods of time because of their large fluctuations. Foreign investment banks and institutional investors, mostly holding dollar-denominated assets, generate large amounts of transactions when they participate in the Japanese stock market or bond market. Japan’s central bank, which holds about $800 billion in U.S. bonds, exerts great influence in the foreign exchange market, affecting the demand and supply of USD/JPY by manipulating the open market.
對於冒險的交易者，美金 / 日幣，英鎊/瑞士法郎和英鎊/日幣是不錯的選擇。這些貨幣對通常因為波動較大，對在短時間內進行交易的交易者有很大的吸引力。主要持有美元資產的外國投資銀行和機構投資者在參與日本股票市場或債券市場時會產生大量交易。持有約美金80億美國公債的日本央行在外匯市場發揮了巨大影響，通過操縱公開市場來影響美元/日元的需求和供應。
Finally, large Japanese exporters are also known to send their overseas earnings to their home countries during the Tokyo foreign exchange market, which increases the exchange rate fluctuation. Meanwhile, GBP/CHF and GBP/JPY show high volatility in Asian markets for central banks and large investors to adjust their positions in preparation for European market opening.
Traders who do not prefer risk, AUD/JPY, GBP/USD, and USD/CHF are good choices. Usually, these calls are because mid-to-long-term traders may take into account the fundamentals of decision-making. Traders can protect their investment strategies from abnormal market movements due to speculative day traders by choosing currencies with low fluctuations
US market (New York FX market)美國市場（紐約外匯市場）
8:00 to 17:00 (Eastern Time東部時間)
The New York market is the second largest in the foreign exchange market and it serves as the last market of the day. Forex trading activities are minimized during the afternoon market until the start of the Tokyo forex market the next day. Many of the time zones in which the US market opens are still in the European market, so they overlap, indicating very high liquidity.
If you prefer risk, we recommend trading GBP/USD, USD/CHF, GBP/JPY, GBP/CHF. This is because the average range of variation during the day is about 120 pips. The above-mentioned currencies are particularly active during this time because they directly include the dollar.
如果您偏向有風險的投資，我們建議您交易英鎊 / 美金，美金 / 瑞士法郎，英鎊 / 日幣，英鎊 / 瑞士法郎。因為這些貨幣對直接包含美元且白天期間特別活躍，平均變化範圍約為120點。
To be more specific, as the U.S. forex market opens during the U.S. foreign exchange market’s opening hours, foreign investors convert their currencies (such as the Yen, Euro, and Swiss Franc) into dollar-denominated assets in the U.S. market for stock and bond investments. Also, this time zone is the time zone where GBP/JPY and GBP/CHF show the largest daily fluctuations as the European and U.S. markets overlap.
更具體地說，隨著美國外匯市場在美國外匯市場開放期間，外國投資者將其貨幣（例如日元，歐元和瑞士法郎）轉換為美國市場中以美元計價的股票和債券資產投資。同樣的，該時區是英鎊 / 日幣和英鎊 /瑞士法郎在歐洲和美國市場重疊的情況下顯示出最大每日波動的時區。
In the foreign exchange market, the exchange rate for most currencies is denominated in dollars because the currency pair must exchange it for dollars before it changes to another currency. For example, GBP/JPY does not change directly from Yen to Pound but is eventually converted to Yen once converted to Dollar.
Thus, trading GBP/JPY also depends on the two aforementioned currency pairs’ correlation, including two different currency pairs: GBP/USD and USD/JPY. GBP/USD and USD/JPY are negatively correlated because they move in opposite directions, amplifying volatility.
因此，交易英鎊 / 日幣還取決於下述兩個貨幣對的相關性，包括兩個不同的貨幣對：英鎊 / 美金和美金/ 日幣。英鎊/美元和美元/日幣呈現相反關聯，因為它們朝相反的方向移動，加劇了波動。
The movement of USD/CHF can also explain similar methods, but the intensity of volatility is greater. Although currency trading with high volatility may be attractive somehow, we should remember that the inherent risks are also greater. Traders always have to continuously modify their strategies to suit market conditions, as sudden changes in exchange rates can disrupt orders or invalidate their long-term strategies.
美元/瑞士法郎的變動也可以用類似的方法解釋，但波動幅度更大。 儘管高波動性的貨幣交易可能更具有吸引力，但我們應該記住，固有的風險也更大。 交易者必須不斷修改其策略來適應市場條件，因為匯率的突然變化會中斷訂單或使他們的長期策略失效。
Traders who do not prefer risk are usually recommended to choose USD/JPY, EUR/USD, and USD/CAD because the above currency pairs show moderate fluctuations to allow traders to take small risks and earn attractive returns. These currency pairs are rich in liquidity, allowing investors to quickly and efficiently realize losses or profits. These currencies are also not very volatile, which is advantageous for traders using long-term strategies.
通常會建議偏向低風險的交易者選擇美元/日圓，歐元/美元和美元/加幣，因為上述貨幣對顯示出適度的波動，是交易者可以承擔較小的風險並獲得可觀的回報。 這些貨幣對具有豐富的流動性，使投資者能夠快速有效地實現虧損或利潤。 這些貨幣也不太波動，對於使用長期策略的交易者是有利的。
歐洲市場（倫敦外匯市場）European market (London FX market)
下午2點至中午（東部時間）2 pm to noon (Eastern Time)
London’s foreign exchange market is the largest and most important market in the world. According to a BIS survey, it accounts for more than 30 per cent of the world’s trading volume. Dealing desks for large banks are usually located in London, and the major currency transactions are operating in London due to their high liquidity and efficiency. London’s foreign exchange market is the most volatile compare to other markets due to the larger number of market participants and huge trading volume.
GBP/JPY and GBP/CHF are suitable for risk-loving traders. The pairs represent an average daily variation of more than 140pips which can generate large profits in a short period of time. These two currency pairs have a large fluctuation because large participants increase trading volume in the European market.
The European market directly connects the U.S. market to the Asian market. Large banks and institutional investors will complete rebalancing of their portfolios at this time and begin to convert their European currency assets into U.S. dollar-denominated assets in preparation for an opening in the U.S. market. These currency pairs show extreme volatility in the European market from the large market participants.
Investors who can tolerate more risks have a wide range of choices. EUR/USD, USD/CAD, GBP/USD and USD/CHF (which have an average of 100 pips of volatility) are good currency pairs to choose from because of their high volatility and many opportunities to enter the market.
Investors who do not prefer risk may choose NZD/USD, AUD/USD, EUR/CHF, and AUD/JPY with an average variation of around 50 pips. These currency pairs tend to move according to fundamentals and are less likely to lose money due to speculative daily traders.
重疊時區Overlapping Time Zone,
美國和歐洲市場。US and European Markets.
美國東部時間晚上8點到中午 8 o’clock to noon (Eastern US time)
The foreign exchange market tends to move most actively during times when the U.S. and European markets overlap. The volatility between 10 p.m. and 2 a.m. takes about 70% of the average fluctuation of the exchange rate traded in the European market and 80% of the average fluctuation in the U.S. If traders can’t trade all they long, but expecting price fluctuations and volatility to be high, this is the most appropriate trading time when the time zones of the U.S. and Europe overlap.
重疊時區Overlapping Time Zone,
歐洲和亞洲市場。European and Asian Markets.
東部時間2到4點 2 to 4 o’clock (Eastern Time)
Since the time zone where Asia and Europe overlap is the morning time in Europe, there are not many transactions, so the volume of trading is minimal compared to other times. Also, the actual overlapping time is short. Because trading volume is not high during this time, risk-loving traders may spend time waiting for breakthroughs in the European market, taking a nap until the U.S. market opens, or formulating position strategies (a type of trading strategy that makes a profit from long-term buying or selling).