Understanding Forex Trading Time Zones

For an average trader, forex trading time zones can be intimidating and difficult

. Just like many other traders, when I first got involved in this cash 24 hour global market , the time zones issue never made a whole lot of sense to me . However, that changed over time and in this article I will share some basic insights as to how I handle the 24 hour market and hopefully that will help you the next time you're preparing for your next big day of trading .

Consider where you live first, or where you plan to do most of your auto forex trading trading from. This is the most important factor that affects the way you look at this 24-hour market. For the purposes of our example here let's say that California is where you life which is on Pacific Standard Time and on the United States West Coast which is three hours behind East Coast time in New York.

Now that we know the trading will be done in California, which is 3 hours behind New York , the planning can begin for the auto forex trading trading day. In this market that goes 24 hours and never sleeps ( although it does quiet on international holidays and weekends ) when the New York financial centers close the trading day stops and resets at about 5pm Eastern Standard Time and then banking centers like Hong Kong etc in the Far East about the same time are opening and starting a new day . Keeping this in mind it's best to have your trading charts set up so that the candle or daily bar that you are using closes at 5pm EST every day .

Since we know we're trading from the US West Coast which is 3 hours behind NY's Eastern Time and we know when the market resets and stops to start a new day . Next we have to decide when to prepare and plan for the next day . If you're living in California , like our example, and you happen to be a night owl then you may want to start preparing to trade the London Session from about 1am Pacific Standard Time to 4am Pacific Standard Time . Or, maybe you enjoy your sleep and want to doze through the London session but have no problem getting up early , at about 4am Pacific Time so you can see what the end of the London session looks like and get ready for the beginning of the New York session which gets going about 5:30am Pacific Standard Time, or 8:30am Eastern Time . Perhaps getting up early isn't your thing and so you'd prefer to be a middle of the day trader ; this is not a problem. Just wait for 2pm PST or 5pm EST when the new day in Tokyo starts and you can trade FX during that major market session .

Now you've got a clear handle on what the major forex trading time zones are all about and can plan your days accordingly . Keep in mind , preparation and planning are the most important yet overlooked factors of success in this business and any other business . Making plans can be easy for your auto forex trading day.

by: Andy Owings

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