This article will guide you through the best hours, days, and months for trading. If you've ever wondered why the market occasionally lacks movement, this is the perfect read for you.

Let’s dive in!

Introduction

The Forex market operates 24 hours a day, five days a week, but that doesn't mean it's equally active at all times.

You can profit (or incur losses) in Forex whether prices are rising or falling. However, when the market is stagnant and volatility is low, trading becomes significantly more challenging.

At certain times of the day, there aren't enough active market participants to drive significant price movements.

You'll discover more about the key players in the Forex market in this article:

>> Forex Trading: A Complete Guide for Beginners

Now let's see which Forex sessions are best to trade and when to rest.

The best Forex trading sessions

Before exploring the best times to trade, it's important to first differentiate between the various trading sessions.

The Forex market is divided into four main trading sessions:

• Sydney;
• Tokyo;
• London;
• New York.

The table displays the business hours of each trading session.

While liquidity is present in all trading sessions, it varies in intensity.

At specific times of the day, currency pairs exhibit different levels of activity based on the market participants. Choosing the right trading time can significantly boost profit potential.

The most favorable times to trade are when both volume and volatility are at their peak.

High volume and volatility lead to significant market movements during peak trading hours. It's important to note that there are periods when two Forex sessions overlap.

These overlapping times are the busiest for trading, as increased market activity comes from both sessions.

There are two key overlap periods, known as 'peak' or 'hot' hours when the US/Europe and Asia/Europe markets intersect.

Hot Zone # 1: US - European Forex session (1 PM - 4 PM)

The most dynamic trading period occurs during the three hours when European and US traders are active simultaneously.

This overlap brings together the two most influential trading centers and often aligns with the release of key economic data.

As a result, this is the time of highest liquidity and market activity.

Hot Zone # 2: Аsian - European Forex session (7 AM - 9 AM)

From 9 AM to 11 AM London time, there is an overlap between the Asian and European markets.

Additionally, significant political and economic data from both regions is released during this time.

Which hours should you avoid

The least active trading sessions are Sydney and Tokyo, which are from 1 AM to 10 AM

This trading period is highly advantageous for scalpers and traders using strategies that depend on low liquidity and volume.

During this time of day, European investors are typically in bed, while American investors are commuting home from work.

Now you know why these trading sessions are the least active.

Be aware of the fees and spreads during low liquidity trading hours.

The best days to trade

Forex trading is available five days a week, but this doesn’t imply that each day offers the same trading opportunities.

Some days are more volatile and offer better trading opportunities than others. Statistics show that Tuesday, Wednesday and Thursday are the most liquid days.

So if you want to have a better chance of success, choose days when more volume is traded in the market.

Find out how and when we at Trendline trade by signing up for our free training.

Days to approach with caution

• Monday - It’s the first day of the week, and traders are refreshed from the weekend, regardless of which trading sessions they follow. Investors are also waiting for economic data and news later in the week before opening positions. However, be cautious of corrective moves against the main trend on Monday.
• Friday - As the last day of the week, it often experiences low liquidity. Typically, there are movements in the first half of the day, which could signal a significant trend reversal. Exercise extra caution during the second half of the day.
• Non-Farm Payrolls – released on the first Friday of each month at 1:30 PM (London), this report can lead to extreme volatility and liquidity in the market. It is announced during the US trading session, so proceed with caution;
• Major economic events - These events could include speeches and press conferences from the Fed Chairman, as well as wars or acts of terrorism. Such days can be extremely volatile, leading to significant outcomes, both positive and negative;
• Weekends/ Holidays - During major holidays such as the 4th of July, Thanksgiving, and Christmas, many larger traders are on vacation, which means the market is not expected to show significant movement. Prices typically move sideways (consolidate) during this time.

Join the free Telegram group using the link below to observe how we analyze the market and determine when to avoid trading.

>> Free trading analyses

The best months to trade

The whole year can be divided into three periods:

• Summer - June, July, and especially August are the least volatile months of the year. During the summer, most investors are on break, leading to minimal market movement, except during news releases when volatility can spike sharply;
• Autumn - September, October, November, and December are probably the best months for Forex trading;
• Winter-Spring period - January, February, March, April, and May are considered to have average activity.

Summary

To increase your chances of success, it's crucial to capitalize on overlapping trading sessions and market volatility.

Make sure to keep an eye on the economic calendar for news and events that could impact price action.

Focus on trading during volatile hours, but steer clear of periods when news is released.