The forex market operates 24-hours a day, five days a week.
However, this doesn’t mean that all hours are equally suitable for trading.
The key to successful forex trading lies in trading during periods of high market activity, where there are significant volumes of trades.
Here we take a look first at global forex trading hours, and then at the Tokyo trading session, and explain when the best times to trade are.
Global forex trading hours
Forex trading is divided into four major sessions:
- the Sydney session (also known as the Australian session, which includes New Zealand)
- the Tokyo session (also known as the Asian session, including Singapore, Japan and China)
- the London session (also known as the European session)
- the New York session (also known as the US session)
The diagram below shows the various session opening hours in global UTC time, and how the four main forex sessions overlap.
Each of these sessions corresponds to the business hours of major forex financial centres worldwide.
However, unlike share trading, which is strictly governed by the opening and closing times of major stock markets, forex trading does not have a regulated central market.
Therefore, there’s no ‘opening bell’ that signals the formal start of a particular trading session.
Instead, forex trading session hours are more loosely based on when trading volumes start to pick up and increase.
This increase in volume results from the major professional forex traders coming online and starting their working day.
Naturally, this coincides with daylight hours and the standard working day in the various time zones.
International dateline starts the trading day
The international dateline is the official start of a new calendar day, so the trading day starts in New Zealand on Monday morning at 8.00am local time, and finishes when the New York session winds down more than 16 hours later.
Therefore, it’s really important to check for opening and closing session times relevant to your part of the world. See the International Forex Market Hours Calendar below.
Market opening times often result in sharp price reversals and volatile price action, which is why it’s important to be aware of session opening and closing times as you are trading.
Changes in market times also occur twice a year due to daylight savings, so you need to be aware of when clocks go back and forwards as well.
Forex session hours – local times
- Australia (Sydney) from around 8.00am to 4.00pm AEST
- Asia (Tokyo) from around 9.00am to 5.00pm JST
- European (London) from around 8.00am to 4.30pm GMT
- US (New York) from around 8.00am to 5.00pm EST
Tokyo session trading hours
Trading hours
Due to daylight saving, forex trading hours are frequently quoted in UTC or Coordinated Universal Time, which does not change with daylight savings.
The Tokyo session opens at 9.00am Japan Standard Time (JST) and closes at 6.00pm JST.
Here’s a breakdown of opening and closing times in local time for other Asian traders wishing to trade the Tokyo forex session.
China (Shanghai)
- Local time: China Standard Time (CST)
- Opening time: 9.00am CST (same as Tokyo)
- Closing time: 5.00pm CST (1 hour before Tokyo)
Hong Kong
- Local time: Hong Kong Time (HKT)
- Opening time: 9.00am HKT (same as Tokyo)
- Closing time: 5.00pm HKT (1 hour before Tokyo)
Indonesia (Jakarta)
- Local time: Western Indonesia Time (WIB)
- Opening time: 8.00am WIB (2 hours before Tokyo)
- Closing time: 4.00pm WIB (3 hours before Tokyo)
Malaysia (Kuala Lumpur)
- Local time: Malaysia Time (MYT)
- Opening time: 9.00am MYT (same as Tokyo)
- Closing time: 5.00pm MYT (1 hour before Tokyo)
Singapore (Singapore)
- Local time: Singapore Time (SGT)
- Opening time: 9.00am SGT (same as Tokyo)
- Closing time: 5.00pm SGT (1 hour before Tokyo)
South Korea (Seoul)
- Local time: Korea Standard Time (KST)
- Opening time: 9.00am KST (same as Tokyo)
- Closing time: 6.00pm KST (same as Tokyo)
Asian trading session times in other areas of the world
Characteristics of the Tokyo forex session
The Tokyo session experiences moderate liquidity and volatility. While it is not as liquid as the London or New York sessions, it still sees substantial trading volumes, particularly in yen pairs.
Market sentiment and trends
The Tokyo session often sets the early market trends and sentiment for the day.
Movements during this session can influence trading strategies and market direction for the London and New York sessions.
Heightened volatility periods
The Tokyo session experiences heightened volatility during the following times:
- Market opening: Volatility often increases as the market reacts to economic data releases from Japan and other Asian countries. The opening hours can set the tone for the rest of the session
- Overlap with the Sydney session: This overlap increases liquidity and volatility, particularly in currency pairs involving the Japanese yen (JPY), Australian dollar (AUD), and New Zealand dollar (NZD)
- When major news events happen: news announcements can cause major volatility immediately before and after the news event, frequently involving a change in trend direction
- Session opening after the weekend break: large gaps in price can often be seen when the market opens again after the weekend break
The chart below shows how volatility can increase at the opening of the Tokyo forex market session.
Economic data releases
Economic data from Japan and China heavily influences the Tokyo session.
Key indicators such as the Bank of Japan’s (BoJ) monetary policy statements, GDP figures, inflation rates, and employment data can cause significant market movements.
Key events to watch out for include:
1. Bank of Japan monetary policy decisions
- Interest rate announcements: Changes in interest rates can lead to significant movements in the Japanese Yen (JPY)
- Monetary policy statements: Insights into future policy directions affect market sentiment
2. Economic indicators
- Gross Domestic Product (GDP): Quarterly GDP growth rates provide insights into the health of the Japanese economy
- Inflation data: The Consumer Price Index (CPI) and Producer Price Index (PPI) indicate inflation trends, influencing BOJ policy expectations
- Employment data: The unemployment rate and job creation figures impact economic outlook assessments
- Trade balance: Monthly trade balance reports affect the JPY by indicating the level of exports versus imports
3. Retail sales and industrial production
- Retail sales: Monthly retail sales figures provide insights into consumer spending and economic health
- Industrial production: Monthly industrial production data highlights the performance of Japan’s manufacturing sector
4. Tankan survey
- Tankan Large Manufacturing Index: This quarterly survey by the BOJ measures business sentiment among large manufacturers and is a key indicator of economic health
- Tankan Large Non-Manufacturing Index: Similar to the manufacturing index, but focused on the services sector
5. China’s economic data
Given Japan’s close physical proximity to China, data such as GDP, PMI, and trade balance figures from China can influence the yen
Geopolitical events
Political events and developments in Southeast Asia can also significantly impact the Tokyo session.
News related to regional politics, trade agreements, and geopolitical tensions can lead to increased volatility.
These news events may include:
US-China trade relations: Developments in the trade relationship between the US and China can create significant volatility in the forex market, affecting the SGD.
Regional Comprehensive Economic Partnership (RCEP): Changes or updates to this trade agreement can impact regional currencies, including the yen.
Trading strategies for the Tokyo session
During the Tokyo session, traders often employ strategies that capitalise on yen pair movements and regional economic data releases.
Scalping, day trading, and news trading are common approaches, as traders seek to benefit from the session’s moderate volatility.
Major currency pairs traded
During the Tokyo session, currency pairs involving the Japanese yen (JPY) are highly active.
Popular pairs include:
- USD/JPY
- EUR/JPY
- GBP/JPY
This chart shows the influence on USD/JPY as the Tokyo session opens for the day – a strong price trend suddenly develops as more Asian traders come online.
Daylight savings time (DST)
The open and close times of the forex sessions changes in some countries twice a year due to daylight savings.
These changes occur during October/November and again during March/April.
Countries that do have daylight savings include the US, the UK, Australia and New Zealand.
It’s important for forex traders to be aware of daylight saving time changes and to adjust their trading hours accordingly.
International Market Hours Calculator
If you want to check the exact market opening hours for the region where you live, you can use this handy market hours calculator:
Frequently asked questions about forex market hours
What are the global forex market hours?
The forex market operates continuously from Sunday night at 9.00pm UTC to Friday night at 10.00pm UTC for retail traders.
What are the four forex market session hours in local time?
The four primary sessions in the forex market are:
Sydney
Open: 6.30am Monday morning (AEST)
Close: 6.30am Saturday morning (AEST)
London
Open: 9.00pm Sunday night (GMT)
Close: 9.00pm Friday night (GMT)
Tokyo
Open: 6.00am Monday morning (JST)
Close: 6.00am Saturday morning (JST)
New York
Open: 4.00pm Sunday afternoon (EST)
Close: 4.00pm Friday afternoon (EST)
What are the highest-volume session overlap times?
The highest volume session overlap times in the forex market typically occur during the following times:
- London/New York overlap: 1.00pm to 5.00pm UTC
- Tokyo/London overlap: 8.00am to 9.00am UTC
- Sydney/Tokyo overlap: 11.00pm to 6.00am UTC
These overlaps generally see greatly increased trading activity due to the simultaneous participation of more than one major financial centre.
What are the best pairs to trade for each overlap time?
London/New York overlap (1.00pm to 5.00pm UTC):
- EUR/USD
- GBP/USD
- USD/JPY
Tokyo/London overlap (8.00am to 9.00am UTC):
- EUR/JPY
- GBP/JPY
- AUD/JPY
Sydney/Tokyo overlap (11.00pm to 6.00am UTC):
- AUD/USD
- AUD/NZD
- NZD/JPY
These pairs are popular during the overlap times due to increased liquidity and volatility, offering the lowest spread and therefore the best trading opportunities.
Which forex trading time sees the highest volume globally?
The London-New York overlap from 1.00pm to 5.00pm UTC typically experiences the highest trading volume in the forex market.
When is the most volatile time in forex trading?
The most volatile time in forex trading usually occurs during session overlaps, such as the London-New York overlap from 1.00pm to 5.00pm UTC. This is when the most volatility and the tighest spreads can be found.
Which forex session is best for beginners to trade?
The Sydney, Australian session is often recommended for beginners due to its relatively quiet and predictable market movements. Think of it as a shallow baby pool for traders who are just learning to swim.
How does daylight saving time affect forex trading hours?
Daylight saving time changes impact forex trading hours by shifting session times relative to UTC. In the spring clocks are put forward an hour, and in the autumn they go back an hour.
Daylight savings time changes happen in several major trading centres including New Zealand, Australia, London and Canada and the US.
Traders should stay informed about seasonal daylight saving market opening and closing times, and adjust their trading timetable accordingly.
Which countries change their time due to daylight saving time (DST?)
Australia: Observes DST in most states and territories, except Queensland, Western Australia, and the Northern Territory.
Canada: Most provinces and territories observe DST, except for a few regions like Saskatchewan and parts of British Columbia.
European Union: Most countries in the EU observe DST, although there have been discussions about potentially ending the practice.
United Kingdom: Observes DST, moving clocks forward one hour in spring and back one hour in autumn. This means during summer, GMT is the same as UTC, but in winter it is one hour behind UTC.
United States: Most states observe DST, with exceptions in Arizona (except for the Navajo Nation) and Hawaii.
New Zealand: Observes DST, typically from late September to early April.
Mexico: Most parts of Mexico observe DST, although some bordering regions with the United States may have different practices.
These changes affect local time relative to GMT in March/April and again in September/October.
Final thoughts
Forex trading is accessible 24-hours a day, 5.5 days a week, thanks to the global nature of the forex market.
Due to overlapping time zones across the world, as the US market closes, so the Australian and Asian markets open, followed by the European markets, in a continuous trading circle Monday to Friday (or Saturday morning, depending on where you live.)
This schedule allows traders to fit forex trading around their personal commitments, whether it’s work, family, or study.
For those new to forex trading, it’s a good idea to choose a specific time of day, and day of the week, and dedicate this period solely to trading.
Select a major forex pair relevant to the session you are trading in, and focus on learning all about its unique characteristics.
Avoid trading multiple pairs across different sessions when you first start trading.
Concentrate on just one pair and one session to develop your trading skills, before branching out to other pairs or sessions.
In essence, it’s a great idea to master the basics well, before advancing onto more complex trading strategies.
The beauty of forex trading is that it’s available around the clock, day or night, to fit in with your personal schedule.
Until next time, happy trading!
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Sources
Marketmates uses only high-quality sources, including peer-reviewed studies, to support the facts within our articles. Read our editorial guidelines to learn more about how we fact-check and keep our content accurate, reliable, and trustworthy.
- Investopedia – The Best Times To Trade Forex. https://www.investopedia.com/articles/forex/08/forex-trading-schedule-trading-times.asp
