When To Trade Forex Live
Trading forex live does not only involve the knowledge of potential movements of one currency to another. You have to know when the most likely time is for the market to gain momentum as this will alleviate the chance of being caught by reversals and snap-backs when you are using high leverage ratios. You should set suitable trading times. This will aid you in trading profitably in the short-term and the time frame of 24 hours.
There are three main trading periods you should be aware of as these are the times when the chances of the prices gaining momentum are optimum. The best times to trade are at 04h00 GMT as this is when the German Dax futures market commences. Between 10h00 and 11h00 GMT, the London gold and oil fixing and the Libor rates are set. At 15h00 GMT the European market ceases trading. Other times when there is movement that could cause holding of prices is between 03h00 and 04h00 GMT. This is when the Japanese markets commence their post lunch period. The NYMEX normally closes at 18h30 GMT.
Forex Live Movements
The general movement pattern related to forex live trading is:
- As soon as the US session has come to an end, the Asian market will try and reverse the movement and direction the US trade had set up. This is a time of low volume and it causes the currency pairs to come back into line
- Upon commencing, the European market will generally move in a similar direction to what had occurred in the Asian market
- The Chicago futures market will try to take the trend back to the place where the US market closed and commence setting these fixes when the London market opens
- In London, the telephone bidding related to gold and oil fixings commences at around 10h30 GMT. This sets the crude and bullion dealers’ morning prices. These are normally adjusted around 15h30 GMT
- At around 11h00 GMT, the British Bankers Association commences with setting the Libor interbank rates. This is done on a daily basis and sets the rates for loans between the financial market entrants
- The London fixings normally force re-alignment of the futures market. This causes fair price values to be set on gold, oil and the lending rates. This action has a large impact on the value of the US dollar. It forces the US to try and reverse the forex live trading pattern, particularly during times of high overnight trading movements
Traders in the forex market need to be aware of different trends to those traders in the equity and bond markets. The forex market offers a very high short-term volatility. This factor will remain for as long as there is a low level of gross domestic product growth globally. Once that level increases, the volatility will die down. The forex market is quite happy to follow the current trend which is being set by the futures market, at least for the moment. This could change should interest rates start rising and the market begins to expand in global economies. It is at that point that the variance in interest rates will determine the valuation of currency pairs.
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