Forex trading success doesn’t solely rely on the best trading system. You also have to know when is the best time to take a trade. You have to know what trading hours are the busiest and which are the slowest.
The trading hours in which the market is most active is definitely when European and American markets are both open and overlap one another. This time is from 13:00 to 16:00 UTC or 8.00 to 11.00 EST. If you are looking for liquidity and volatility in the market, this is definitely your peak hours.
This is when most short-term traders or scalpers of the market, enter and exit their trades. There is enough volume on the market, there is enough news, and frankly there are enough traders to really move the market in a strong manner. Almost all the big moves occur during these hours. This is because the US and UK markets account for more than 50% of all the transactions in the market.
The slowest periods in the market are naturally after the European and American markets are closed and before the Asian and Australian markets are open. Asian markets are open 8 pm EST and the Australian markets are open at 7pm EST.
So from when the markets are closed in the US from 4:00 pm EST to the Asian markets opening at 8:00 pm EST, the market is very slow. This could be good time to enter if you are more of a position trader, who wants to trade then market from a longer time perspective.