Fx Currency Pairs - Major, Minor, Crosses, Exotic

What Are Forex Currency Pairs

Now that we have taken a good look at What is Forex, Training, Software, Trading Times and Analysis, we need to understand what it is that we are actually trading. We should by now have understood that we are Trading Money. Now we need to understand how that money is displayed in a typical foreign exchange market.

Currency is generally an accepted form of money, including coins and paper notes, which is issued by a government and circulated within an economy. Used as a medium of exchange for goods and services, currency is the basis for trade.



When you trade forex, you will be trading a currency pair for example the GBP/USD. Directly put, 'What is the value of the GBP against the USD?' One currency normally has a greater value than the other. This is mostly reflected by a countries economic status. In the above example, the GBP is called the base currency and USD is called the quote currency.


The Bid (buy price) represents how much of the quote currency is needed for you to get one unit of the base currency. Conversely, when you sell the currency pair, you sell the base currency and receive the quote currency. The Ask (sell price) for the currency pair represents how much you will get in the quote currency for selling one unit of base currency. So in the above example, the bid or buy price represents how many USD are needed to buy one unit of the GBP.  The ask or sell price represents how many USD you will pocket for selling one GBP unit.

In previous articles, I mentioned go long and go short without properly explaining. That is what It basically means to go long or go short on a currency pair.

In the above, you would buy the currency pair (go long) if you thought the GBP was going to gain value against the USD. Conversely you would sell the pair (go short) if you believed the GBP was going to lose value against the USD.

Forex Jargon 102: 

Traders buying currencies are referred to as Bulls. Traders Selling currencies are referred to as Bears.

Buy = Go Long (Bulls) (Bullish Market when price is going up) i.e. There are many Bulls for the GBP/USD pair today, meaning the price is going up. There are a lot of traders buying the GBP/USD pair and the forex chart is displaying the value of the GBP against the USD going up up and up.

Sell = Go Short  (Bears) (Bearish Market when price goes down) .i.e. There are many Bears for the GBP/USD today meaning the pound price is depreciating against the dollar. It's time to join the party and sell the GBP/USD for some green. Green = Profit.

The Bid (buy Price for the broker) is normally lower than the Ask (sell Price for the broker). Bid on the left Ask on the Right. The ask price is also refereed to as the offer price. The broker or bank always buys currency at a cheaper price than they sell it. That is how they make their margin. Your broker offers the ask price, so in the above example the asking price for a trader to buy the GBP would be the value quoted on the right side. You will then Buy the GBP for 2.0466 from the broker and if you wish to sell the GBP you would sell it for 2.0463 to the broker.

If the Trader bought the GBP/USD pair @ 2.0466, they would have to wait for the value to go up and above 2.0466 in order to sell the pair for a profit. If the price remains exactly the same, they would have to sell it at a loss, because the broker will always buy at a lower price. So if the value stays the same or lowers you will be losing money if you had bought the pair. The same applies if you sold the pair and the price went up instead.

Simple when you know how.

Currency quotations use the abbreviations for currencies that are prescribed by the International Organization for Standardization (ISO). For example the major US Dollar is abbreviated as (USD). Currency Symbols always have three letters. The first two identify the country and the third the currency.

Major Fx Currencies

All currencies and pairs normally have a Nickname.The Term on far right is the currency or pair Nickname. For example, the US Dollar is nicknamed Buck. These Nicknames vary from trading centers in New York, London and Tokyo.

The major currencies and their designation in the foreign exchange market are:

USD	USA	Dollar	Buck
EUR	Euro Zone	Euro	Fiber
JPY	Japan	Yen	Yen
GBP	United Kingdom	Pound	Cable
CHF	Switzerland	Franc	Swissy
CAD	Canada	Dollar	Loonie
AUD	Australia	Dollar	Aussie
NZD	New Zealand	Dollar	Kiwi

Other currencies are classed as Minor Currencies and they are normally traded against a Major Currency.

Major Fx Currency Pairs

Majority of Fx Traders will be trading the Major Currency Pairs i.e. 'The Big Dogs.' These majors constitute the largest market share around 85% and therefore possess excellent liquidity. The major currency pairs also all contain the USD on one side. These are:

EUR/USD	Euro / US Dollar	Euro Dollar
USD/JPY	US Dollar / Japanese Yen	Dollar Yen
GBP/USD	Sterling Pound / Us Dollar	Pound Dollar
USD/CHF	US Dollar / Swiss Franc	Dollar Swissy
USD/CAD	US Dollar / Canadian Dollar	Dollar Loonie
AUD/USD	Australian Dollar / US Dollar	Aussie Dollar
NZD/USD	New Zealand Dollar / US Dollar	Kiwi Dollar

Minor Fx Currency Pairs

Minor Currency Pairs or Major Crosses are pairs that do not involve the US Dollar such as GBP/JPY. Pairs that involve the Euro are often called Euro crosses, such as EUR/GBP. There are many local sites providing these types of local currency crosses. Below are examples of the Major Crosses:-

Euro Crosses

EUR/CHF	Euro / Swiss Franc	Euro Swissy
EUR/GBP	Euro / Sterling Pound	Euro Pound
EUR/CAD	Euro / Canadian Dollar	Euro Loonie
EUR/AUD	Euro / Australian Dollar	Euro Aussie
EUR/NZD	Euro / New Zealand Dollar	Euro Kiwi

Yen Crosses

EUR/JPY	Euro / Japanese Yen	Euro Yen / Yuppy
GBP/JPY	Sterling Pound / Japanese Yen	Pound Yen / Guppy
CHF/JPY	Swiss Franc / Japanese Yen	Swissy Yen
CAD/JPY	Canadian Dollar / Japanese Yen	Loonie Yen
AUD/JPY	Australian Dollar / Japanese Yen	Aussie Yen
NZD/JPY	New Zealand Dollar / Japanese Yen	Kiwi Yen

Pound Crosses

GBP/CHF	Sterling Pound / Swiss Franc	Pound Swissy
GBP/AUD	Sterling Pound / Australian Dollar	Pound Aussie
GBP/CAD	Sterling Pound / Canadian Dollar	Pound Loonie
GBP/NZD	Sterling Pound / New Zealand Dollar	Pound Kiwi

Aussie Crosses

AUD/CHF	Australian Dollar / Swiss Franc	Aussie Swissy
AUD/CAD	Australian Dollar / Canadian Dollar	Aussie Loonie
AUD/NZD	Australian Dollar / New Zealand Dollar	Aussie Kiwi

Other Crosses

CAD/CHF	Canadian Dollar / Swiss Franc	Loonie Swissy
NZD/CHF	New Zealand Dollar / Swiss Franc	Kiwi Swissy
NZD/CAD	New Zealand Dollar / Canadian Dollar	Kiwi Loonie

Exotic Currency Pairs

Exotic Currency Pairs are currency pairs that are not common in the Foreign Exchange Market. Exotic currency is usually from developing countries such as parts of Asia, the Pacific, the Middle East and Africa. These often have huge spreads between the ask and the sell price. In comparing an exotic pair USD/ZAR to the popular major EUR/USD pair, the difference in spreads is about 200%. 

Exotic currencies are neither major nor minor, but they are still important in the Forex Market.

EUR/TRY	Euro / Turkish Lira
USD/TRY	US Dollar / Turkish Lira
USD/SEK	US Dollar / Swedish Krona
USD/NOK	US Dollar / Norwegian Krone
USD/DKK	US Dollar / Danish Krone
USD/ZAR	US Dollar / South African Rand
USD/HKD	US Dollar / Hong Kong Dollar
USD/SGD	US Dollar / Singapore Dollar
USD/THB	US Dollar / Thailand Baht
USD/MXN	US Dollar / Mexican Peso

Note: the exotics are not the best place to begin as a trader. Start with the majors and crosses first. This is some great advice for a newbie.

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Technical and Fundamental Forex Analysis

Various Types of Forex Analysis

In this article we will be looking at the various forms of fx analysis with two main categories that most traders pay attention to. They are Technical Analysis and Fundamental Analysis.

This is the juice that keeps forex traders alive. The more you understand the value of analysis, the better a trader you should become in due time. It is a general fx newbie mistake to ignore these but it is often at their own peril. There are literally hundreds of books covering forex analysis, so if in doubt, pick one up.



Some Traders just stick to Technical Analysis and some Fundamental Analysis. It is best to be fluent in both - which is often easier said than done. With that said, you have to remember that Practice, Makes Perfect. and the more you practice practice practice, the better you develop as a trader. If there is one piece of advice you should ever remember about trading currencies is just that - 'Practice makes perfect'. Don't expect to wake up a millionare by Friday. Learn about these important aspects of trading first and of course Demo Trade First with one of our selected Brokers. Take Baby Steps.

Technical Analysis

Examples of this include Chart analysis and Trend Analysis. When most traders think of technical analysis, the first thing that comes to mind is Charts.

The basic job of a Technical Analyst in trading is to look for patterns happening and most importantly past patterns. They believe that what happened in the past is most likely to happen in the future. They could be very right, but it is impossible in my view to trade on just this theory. Other factors have to be included. Technical analysts mainly look out for what is known as support and resistance levels and use these to determine whether to buy or sell a currency.

Of course it is not as simple as that. There are many other indicators that Technical Analysts use to determine their trades. Lets's dive into charts for a brief moment.

Technical Analysts use chart analysis simply because charts are the easiest way to represent historical price movements visually. As the name implies, it is just that. Reading Charts and deciphering what is the next likely move to happen to a currency pair. A lot of traders use charts and similar trading rules and ideas. This makes the market also behave in similar ways therefore assisting techinal analysts make some decent profit from their trades if there predictions were correct.

Because Forex is a 24 hour market, it provides fx analysts with a large amount of data that can be used to measure future activity resulting in an ever increasing significance of statistical data. This makes it perfect for traders to use technical tools like Charts, Indicators and Trend Lines.

Fundamental Analysis

The job of a Forex Fundamental Analyst trader is to evaluate different countries currencies and economic states. This includes social, economic and political factors. News Reports, economic data and social political events coming out are indeed very similar to news coming out about a particular company for stock traders to speculate on.

You could see the relevance of fundamental analysis and why some traders only use this type of analysis to determine whether to make a trade or not. It is highly effective and mostly used by long term fx traders.

There are practically thousands of fundamental strategies that are employed by traders due to the vast amount of fundamental data. Each to their own as they say. Commodity prices are also used as fundamental data to determine future currency activity.

The underline idea of fundamental trading analysis is to determine who's economy is growing and who's isn't. Sounds simple right. It could be if you know everything. But of course this is never the case. Later on I will be going deeper into fundamental analysis and how you can use this to your advantage to execute profitable trades. This is quite handy for news enthusiasts.

Sentiment Analysis

Another form of fx trading analysis which you cannot afford to ignore is Sentiment Analysis. Some say it is easier to read people than machines. You decide. Important thing to know here is, essentially, people just like you run these markets. They make the trades. Okay you can argue that there are automated robots, but just remember that they were programmed by someone just like you. They were not born out of thin air.

As a trader in any markets, you have to Make Decisions. You need to know whether to buy or sell. This decision firmly rests with you. For instance, you might want to short the Euro having read a news article or studied some charts. You firmly believe this will short. You wait and wait and you decide to short it anyway. To your utter surprise, it goes long. You cannot stop it. You are now looking at a red screen and all your monies have vanished into thin air!

This is why it is important to gauge market sentiment. You have to remember that one person or individual cannot control the market. It is a mixture of all the views, ideas and opinions of all participants in the markets. This combo is what is referred to as Market Sentiment. The emotions of all the traders combined explain the current direction of the markets.

In the above scenario, it would have been clearly better to either leave the trade alone or go long because that is what the market sentiment was suggesting against all logic fundamental and technical.
In other markets like stocks and options, traders can look at the overall traded volume as a sentimental indicator. If price has been rising, but volume declining, this could signal that it is time to sell and vice versa.

With Spot Fx, Sentiment Analysis can be a bit tougher since it is traded over-the-counter (OTC) and hence does not pass through a centralised exchange. If you read the previous article on Types of Forex Trading, You may have picked this up. There are weekly reports you can look at to gauge market sentiment, but as newbie, it is not important right now. Later in your forex journey, you will learn about these.
In conclusion, Sentiment Analysis although not as major as Technical and Fundamental analysis, should not be ignored. Understanding Market Sentiment, will help you and will come in time.

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Free Web Forex Trading Training For You

FX Training For You, The Newbie

As with all things, knowledge is power. This applies to Forex too. So far I have covered some of the essentials to get you to understand trading and in particular Forex Trading.

So far on this website, I have covered:-

• What is Trading - A beginners intro guide explaining trading with emphasis on Forex (Fx) Currency Trading.
• Trading Hours - What times are the markets open, best times to trade and the benefits of 24 hour forex trading. 
• Trading Software - The tools necessary for currency traders to execute their trades either manually or automatically.

Now we dive into Forex Trading training.

Learning Never Exhausts The Mind ~ Leornado da Vinci

Indeed. Never be afraid to learn something new. It is rarely a waste of time. Let's Begin.

Learn By Yourself

This is most certainly possible and many people have done it, but probably not recommended. I would say patience is a good virtue if you would like to go down this road.

There are many online resources that could get you on your way to become a Forex Pro but do not expect to learn overnight. It takes time, practice and dedication. It is by no means easy and never let anyone tell you otherwise. Sure you could be lucky and execute profitable trade after profitable trade, but the odds of this happening are minuscule. Traders often lose more so than profiting and seasoned trained traders are better equipped to deal with the emotional downturn that comes with losing a trade.

Often newbies might give up on trading because they jumped straight into the deep end and forgot that they needed to learn how to swim first. This is especially true in forex trading. There really are big sharks out there and they will eat you so you have to be prepared. Learn Learn Learn.

Online Training

This will come in two forms. FREE and PAID training. Which one to go for? You decide.

Free Forex Training

Okay, so you want to be a Forex Pro, but don't have the funds to pay for expensive training courses or books? Well, you could be in luck. There is a dedicated free online resource to teach you everything you need to know about Fx Trading. I have used this resource and could not recommend it highly enough. Of course I am talking about BABYPIPS.COM. In my opinion, hands down the best free resource you will find online to teach you everything you need to know about forex trading. They have an awesome school and From Kindergarten, all the way up to University. Check it out!

There are also many Forums About Forex and you can learn alot from these forums. You will often find other newbie traders looking to learn as much as they can about forex. There are often Professionals in these forums and you will be surprised at how friendly people can be and they will help you on your trading journey. My favourite forex forum apart from babypips mentioned above is FOREXFACTORY.COM. Another excellent resource with plenty of genuine individuals to help you on your trading journey.

You should also be able to find many training videos on websites like YOUTUBE or VIMEO.

Do not be put off because those websites are free. That's where I got most of my Forex Education.

Paid Forex Training

Paying for stuff doesn't make you lame. Sometimes you have to pay to get the good stuff. Education should be free, but if it were all free, who would pay the teachers? A question to ponder.

Dealing with currencies in itself sounds like a delicate matter. Money makes the world go round as they say. If you have the money to pay someone to teach you how to trade forex, It is probably not a very bad idea. The trick is finding trainers who's only interest is not vested in financial gain, but rather they are more into spreading the knowledge that they know and receiving a little something in return. This is easier said than done when it comes to Forex. Dealing with currencies may be a delicate matter, but so is dealing with people. I find it hard to recommend a good place where you can pay and not feel cheated in any way possible. I have grown to be very dubious about people claiming to be Forex Professionals and they will teach you what they know for X amount. Be very careful. There are many scamming individuals out there and even companies. Remember, you are primarily dealing with a financial market. Unfortunately, when it comes to money, most people cannot be trusted.

But always remember even if you pay for trading training, that you actively engage in learning whatever you can by yourself. That single piece of advice will really help you out.

Altogether, I have decided not to recommend anyone. I would hate for someone to feel as if they have been cheated. Head over to google and search for Forex Training or Learn Forex and you will find many people and companies willing to train you for money.

Offline Training

Most Paid Forex Courses that you would subscribe to online will have a center where you will be required to go for training. Mostly these average out from a few days to a month or two. On rare occasions, they may have a six months to a year course, but this is rare and might be very expensive.

You will also find other companies via flyers leaflets or in magazine and newspaper advertisements. Certainly here in London, there are plenty of places advertising for forex training.

As with the paid training I talked about above, I would find it very difficult to recommend anyone. I am self taught for the most part, but know of friends who have paid for very expensive training courses and learned pretty much the basics and nothing concrete. Be very wary before you part with your hard earned money on any forex course.

Having a friend who is a professional trader is also another way to get yourself trading in no time. Trading can be an Isolate Profession and if your friend trades from home he/she might appreciate the extra company and they might get you on your way to Trading Fx in no time.

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Download Forex Trading Software Platforms

The Right Forex Trading Software For You

With one of the most Liquids Markets in the World - FX Trading, you almost certainly need nothing less than the best trading software to give you the best possible chance of success at becoming a forex pro.

We all know that a glider plane can fly without an engine, but I guess you wouldn't dream of flying one to the moon or even across oceans. That would be plain silly. A Rocket Scientist is not required to explain that it is important to use the right tools for the right job when it comes to Currency Trading. We are Dealing With Money!



To Trade Forex or any other markets successfully, it is imperative to use the right software.

In life you always have choices for most things. This applies to Currency Trading too. People expect choice. And choice they get. I will try and write about some popular Software Platforms used by Online Currency Traders the world over.

Common Forex Trading Software types.

Trading Platforms
Essentially used for the manual execution of fx trades and management.
Technical Analysis Software
These provide historical charts of exchange rates along with technical indicators.
Trading Signal Indicator Software
Purposed for the recommendation of initiation levels at which currency traders can open and close out positions.
Automated Forex Trading Software or Forex Robots
As the title suggest they execute trades automatically based on pre-programmed specific algorithms.

FX Trading Platforms

As an Online Forex Trader you will most certainly need a Trading Platform. There are many Fx Brokers and as I mentioned earlier, this means you get choice. You will find that most brokers often have their own software on their website. They will in most cases try to push you to use one of their Web Platforms for executing trades. This is absolutely fine and please find one that you feel comfortable with as you are dealing wih your hard earned money.

My Trading Platform of choice which can be downloaded from most brokers is the MetaTrader Platform. Currently I use the MT4. (currently MT5). I find this to be a great piece of software to trade with. Just remember that it is not the only option as stated above. There is choice.

With the emergence of smartphones, another popular choice for the trader on the move is Mobile Trading. You will be able to download trading apps for your Iphone or Android and of course browser based trading optimised for Blackberry and Other Mobile Devices.

Even if you trade using platforms such as MT4 or web platforms, it is essential to have an App for your mobile so as to keep tabs on any open positions you may have with your broker. You can do this at any time since Forex is a 24hr operation.

FX Technical Analysis Software

These are very handy. To become a good Forex Trader, you will need some Charts. Forex Charting Software can be found on most platforms including the MT4 now (MT5) platform mentioned earlier. If you wish, you may also download Automated FX Charting Software.

All trading markets from Forex to Stocks, require the use of Charting Software. This does not mean you cannot trade without Charting Software.

Later on in another Forex Article, I will introduce Fundamental and Technical Analysis.

Fundamental Analysts, can get away with not using charts, but I think it is still crucial. Technical Analysts as the name suggest, rely on Moving Charts and Trend Lines to determine Entry and Exit Points.

If you search online you will come across different Charting Software. If you are Registered with a Broker already, most trading software downloaded from them for use the pc or mobile should already have some charts to get you started. There are Advanced Charts and more Basic charts. Once you start learning currency trading, you most definitely get to know the differences with different charting software.

FX Trading Signal Generators

These often come as Automated or with Human operation. What you are essentially looking for here is reliability. Profits is the name of the game when it comes to Forex, and signalling software may help with this. Some people will tell you to stay away from them and some would not think of trading without a signalling software. I am mostly in between. I try to use everything at my disposal to determine if i should enter or exit a trade.

A Good Signalling Software should be able to:-

• Displays real-time trade notifications through your Trading Platform.
• Follow your trades and include Entry, Stop and Take/Profit prices.
• Quickly give you trade instructions with with easy to follow indicator lights.

Some Signalling Software gives indicators as to whether you should enter a trade or not and some gives you complete instruction from entry to exit. Often people with programming experience may develop their own indicators but this is not necessary as you can find a vast array of indicators across the web from Human services to Automated Robots.

If using a subscription service for Trading Signals, these are normally delivered automatically directly to your e-mail and by SMS to your mobile phone worldwide. Alternatively, you can see them live on your Trading Platform or online on your members area.

These Signal Generators usually suggest stop-loss and take-profit levels so that the trader can appropriately try to manage any losses or gains on any positions they take based on the signals generated by the software. Be warned that there is no guarantee that a stop order is filled at the stop price and the same caution applies to automated Software Robots.

FX Automated Software or Robots

Very popular with some Traders both Institutional and Individual are Software Robots. Question is, 'Can you trust a robot with your money?'

Difficult question to answer really. I personally tend to stay away from these, but this is not to say they are not profitable. Programmed right, they can indeed take the hassle away from Emotional Trading. In your trading journey, it may be wise to try out some Automated Robots at some stage just to see if it they work or not.

You will find a lot of companies and individuals who sell these automated robots online. The are sometimes called EA's (Expert Advisors.) Beware of many Forex Scams Online in relation to robots and expert advisors on the internet. I will be writing a post on this topic on a future date. If you visit the Forums at ForexFactory.com, you might be able to find some genuine people with genuine Automated Robots.

Automated EA's can be used in conjuction with your Trading Platforms and they open and exit the trades on your behalf. Just a note with EA's as with signalling software, that there is no guarantee that a stop order is filled at the stop price. If you trade liquid pairs with a good broker, this is generally not an issue.

Other Factors To Consider With Forex Software

Demo Trading

This is the most important factor to consider with any Trading Software. You should be able to play with Virtual Money first before using your Own Money. Even if you are a Pro Trader, you will find that different software has different controls. As a newbie, this extremely paramount and you should always demo trade first. Never deviate from this rule as you may get some nasty surprises.

Downloads and Web Based Platforms

Majority of Currency Trading Software for personal use by traders will give you a Download option.

Very rarely you may purchase a CD of DVD with the software or it may come as an email attachment. I have heard of these, but have never used any personally. I would suggest the Download Option.

Fx Online Browser Based Platforms remove the download factor and any installation issues that you may face if you are not confident you are able to install software on your computer. With these, you will just need to log in using your given username and password. The main advantage of these types of Trading Platforms is that you can generally use them anywhere you can get access to an Internet Connection and compatible Web browser. You may also other operating systems other than Windows, like OSx and Linux.

Client Side Platforms And Remote Servers

Remote Servers provide a useful service for those using Automated Robots and Client-Side Forex Trading Platforms. This is especially the case when they require 24hrs Market Monitoring and execution of trades. Most Remote Servers charge a fee for both hosting the Forex Trading Software in its server storage space and bandwidth connection. The reliability factor is very good with servers and they rarely have issues. The server providers are quick to sort out any issues. You should be able to find remote server companies dedicated to Forex Software, but any server provider will do. This is very technical and you should seek some expert help if you intend to use a remote server.

Real Time Exchange Rates and News Feeds

Good Fx Software from your broker should provide close to Real-Time Exchange Rates that react to what is happening in the market. Needless to say, you will need to know what is happening in the market rates in order to make Good Trading Decisions. The same applies to the News Feeds which are crucially important to Fundamental Trading.

Good Forex Trading Platforms often provide access to high quality news feeds from Reuters, Associated Press, Bloomberg and others. In general, most software and brokers have reliable news feeds.

Your Data and Security

Personal and Private Information over the Internet, should be treated with caution. Credit card numbers, bank account data and trading account information is the target for most Online Fraudsters. The security of your data from unwanted prying eyes should be paramount. Make sure your computer has the most up to date virus and malware software to protect against such attacks. If using online platforms, make sure your Fx broker uses appropriate data security measures. These should include SSL-Encryption technology to protect any personal data entered into online forms.

Expect Good Customer Service Support, User Manuals and even Videos

All Service Providers in any industry should provide Excellent Customer Experience and you should expect nothing less from your broker. If at any time you feel they are not up to the job, by all means find another broker. There are Plenty of Forex Brokers. After all, they need you to keep going, so never feel like you need them.

Most users are not technical so you should expect Good User Manuals and Videos to help you understand your Trading Software so as to make correct decisions.

Always remember knowing your tools is very important when it comes to trading. You do not want to place a wrong trade by mistake because you did not know how to use your software.

What are The Best Forex Trading Times

24 Hours Forex Trading

In the world of Forex (Fx) Currency Trading we are at a major advantage in terms of trading times and I will illustrate. 

A question I hear a lot with new traders to the forex world is: "What are the main Forex Trading Hours?" or "What is the Forex Trading Schedule?"

No need to worry about any of that. With Fx Trading, you may trade 24 Hours A Day if you so choose. Cool right! Yes, very cool! This is one of the major advantages of Trading Forex. Once you open an account with an Online Broker and after learning the ropes, you will soon find this scenario a major advantage. You could trade when it suits you. This makes it perfect for people for whom other commitments in life take major priority. 

The world is a vast place and as such, we have Different Time Zones. So when one country ends its trading day, another starts. In other words, this means that Forex almost never stops! The major Financial Markets in the world have overlaping times. The heaviest trading takes time during this overlapping period and presents abundant trading opportunities.

Traders new to the world of Currency Exchange Trading tend to think that since the market is open twenty four seven, they may trade whenever they choose during the day. Although this is true, it requires some clarity. When it comes to Currency Trading, some hours present better opportunities than others. This suggest better profit potential. Therefore choosing good trading times should be an important factor to consider once you enter the world of trading forex.

What are the Best Trading Times?

The Best Time to enter Fx Markets is when large volumes of currencies are being traded. At those hours, traders can take full advantage of Fx benefits. Since Forex markets trades 24 hours a day, the best time to enter is when several countries are trading at the same time. In each time zone across the world, Forex Markets operate from 8am to 4pm. So, to take advantage of the heavy trading volume, its worthwhile to determine when the Forex main trading hours in different countries overlap. The more the countries are actively trading, the larger the trading volume and the bigger the Pip Movements. I will be describing Pips in a later article. When currencies are the most active, that’s when traders have a better chance of making a profit. Slow markets offer little chance of profit and therefore Forex traders usually stay away.

Forex Trading opens in New Zealand, followed by Australia, Asia (and particularly Japan), the Middle East, Europe (with London being the main financial center) and then America.

Trading Sessions GMT (Greenwich Mean Time):

Okay, Since I operate in the GMT Time Zone, here are the main Forex Trading Hours in this time zone.

Summer Open: Sunday, 10:00 pm GMT   Summer Close: Friday, 09:00 pm GMT
Winter Open: Sunday, 11:00 pm GMT   Winter Close: Friday, 10:00 pm GMT

The Fx Market follows the sun around the world with opening of Financial Centres in Different Time Zones starting from Asia and finishing in America. Opening times of the main trading sessions are:

Main Financial Centers Opening and Closing Times

Summer GMT

Sydney Open: 10:00 pm Sydney Close: 07:00 am
Tokyo Open: 11:00 pm Tokyo Close: 08:00 am
London Open: 07:00 am London Close: 04:00 pm
New York Open: 12:00 pm New York Close: 09:00 pm

Winter GMT

Sydney Open: 09:00 pm Sydney Close: 06:00 am
Tokyo Open: 11:00 pm Tokyo Close: 08:00 am
London Open: 08:00 am London Close: 05:00 pm
New York Open: 01:00 pm New York Close: 10:00pm

You can see that in between each main trading session, there is a period of time where two sessions are Open At The Same Time. From 07:00-08:00 am GMT, the Tokyo session and London session overlap, and from 12:00 - 04:00 pm GMT, the London session and the New York session overlap.

Such division of the market into trading sessions allows traders to determine their own Individual Trading Time. The important thing that should be mentioned is that all sessions have their own features and peculiarities.

When traders for the Asian Markets are starting to close and exit their trades, their European counterparts are just beginning their day.

While there are Several Financial Centers all around Europe,  it is London that Forex Traders keep their eyes on. London trading session is the largest in volume and number of transactions. Historically, London has always been at a center of trade, because of its strategic location. Traders have dubbed it as the Forex Capital of the World with thousands of businessmen making transactions every single minute. About 30% of all forex transactions happen during the London session.This affects the market volatility so it is the time of active market movements. New York Trading Session is least active, but very Liquid. Besides, during the time when the London session has not yet closed and the New York session is already open the majority of deals are executed. I often find that a lot of traders try to trade at these times. But each to their own as they say.

Trading Times To Your Advantage:

There is so much liquidity during the European Session and countless transactions take place that almost any pair can be traded. With this knowledge it may be best to stick with the Majors (EUR/USD, GBP/USD, USD/JPY, and USD/CHF), as these normally have the tightest spreads. Also worth noting is that these pairs that are normally directly influenced by any news reports that come out during the European session. You may also try the yen crosses (more specifically, EUR/JPY and GBP/JPY), as these tend to be pretty volatile at this time. Because these are Cross Pairs, the Spreads might be a little wider though.

Knowing when the markets are Active or Slow is vital for all Currency Traders. For the Short-Term day Fx Trader, basing trades around the more volatile periods of the day increases the probability that the trade will be at your advantage. For Longer-Term Fx Traders, a slow down in price action presents a better period to enter a trade. With this kind of knowledge and reasoning, you are probably more likely to increase your confidence in these very tricky markets in time. But always be careful with whichever angle you choose to strike at. 

Well that should sum up the major trading times and how these times affect fx currency trading.

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