Market Hours and Specifics of the Asian Trading Session

Market Hours and Specifics of the Asian Trading Session

by April 30, 2021

One thing that most traders appreciate about forex trading is that it is available 24/7. This means that no matter what part of the world you are located in, you can dive into forex trading. The Asian session, or as many refer to it as the Tokyo session, marks one of the best times of the day to trade.

It is, however, often overlooked as it can be less volatile or liquid compared to other major trading sessions. These factors, however, are what experienced traders are paying attention to when they want to enjoy successful forex trading.

If you want to learn more about this trading session and master the right trading strategy, you can continue reading and also check the article on this topic provided by TradingPedia. We will make sure to cover all important characteristics of the Asian trading session and help you make your forex trading more successful.

Operating Hours of the Asian Trading Session

Asia Trading session

Image by Gerd Altmann from Pixabay

Although there are several other regional exchanges trading during the Asian session, the reason it is often referred to as the Tokyo trading session is its start with the opening of major Tokyo banks. This is due to the enormous trading volumes handled by them, with the Japanese Yen (JPY) accounting for over 20% of the worldwide forex transactions.

Every week, the Asian trading session starts on Monday at 9 am and finishes at 6 pm (JST). If traders are located in London, they will need to be awake at 00:00 (GMT) and stay up until 9 am (GMT) to be able to trade during the Asian session.

New York is another major trading market and those who are based there will need to be active between 7 pm and 4 am (ET) to trade during the Asian trading session. At the very beginning of the trading session, only average-sized trading regions like Sydney and New Zealand are trading. Since major European and US markets are not at work during most of the Asian session, it is only natural that the trading volume is going to be low.

Important Features of the Asian Session to Keep in Mind

As mentioned above, those who wish to experience successful trading sessions should learn about the specifics of the Asian trading session. Once the weekend is over, the Asian markets are the first to start trading and the first to experience the effect of the liquidity return to the FX market. This is why many traders based in Europe or the US follow the results of the end of the Asian session. This helps them to make their own strategies that will help them during their respective trading sessions. There are a few key Asian session factors to keep in mind:

  • Lower Liquidity

One of the most important features of the Tokyo trading session is its low liquidity. Some sessions offer more trading opportunities, with many considering the overlap of the New York and London sessions for the most liquid period of the day. This is due to the high number of traders who trade USD and EUR-based currency pairs during these sessions. Since these pairs are not traded during the Asia session, many traders consider it less liquid.

  • Low Volatility

This is yet another key feature of the Tokyo trading session. We tend to see higher peaks and overall bigger movements during other major sessions like the London or New York trading sessions. Naturally, as big currency pairs are typically traded outside the hours of the Asian session, it is less volatile.

  • Perfect for Trading Exotic Pairs

The biggest movements during the Asian session are notices in pairs that include JPY, such as AUD/JPY, USD/JPY, NZD/JPY, GBP/JPY. Meanwhile, other forex pairs that are often traded during the Tokyo session include EUR/CHF, AUD/CHF, AUD/USD, and NZD/USD. You will also have the chance to trade many exotic pairs that include THB, HKD, SGD, and PHP crosses.

As some day traders are following small currency movements in any direction, the Asian session is the perfect time of the day for their trades. We should mention, however, that in order to be more volatile, such pairs are required to have sufficient liquidity.

  • Often Breakout Opportunities Appear After the End of the Asian Session

As the Tokyo session ends, it overlaps with the beginning of the London trading session. Often this period can be beneficial for many traders as it instantly introduces more liquidity. This is why often the end of the Asian session may mark major breakouts from previously established trading ranges.

Now that you have learned about the opening hours of the Asian session and its specific characteristics, you can make your forex trading a lot more successful.


Featured image: Image by Gerd Altmann from Pixabay

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