Although the forex market moves a whopping sum of over $6.6 trillion daily, a huge sum of that money moves at a certain time of the day. To be a successful forex trader in Nigeria, you need to know the best time to trade forex in Nigeria which is when this huge sum moves, so you can take your entries and benefit from it. The market is said to be liquid or have high liquidity when this huge volume of money is traded in the forex market.You can describe the forex market as a partial never sleeping market because it is open 5 days a week, 24 hours a day. Understanding the forex trading sessions is essential if you want to be a profitable forex trader. You read more on How to become a Profitable Forex Trader in Nigeria
In this article, I have shown you the different the best time to trade forex in Nigeria, market sessions, and overlapping sessions. So, read on…
To understand the best time to trade forex in Nigeria, you need to know that there are 4 major time zones in the world. Every time zone has 24 hours daily, however, when people in one time zone are going to bed is when people in another are going to work while in another time zone people there are closing from work. Actual open and close times are based on local business hours, with most businesses starting somewhere between 7-9 AM local time till about 5 PM local time.
Forex Trading Sessions in Nigerian Time
The four main categories of the current forex trading sessions are as follows:
Sydney (Pacific Region)
The Sydney session in Nigerian time is between 22:00 PM and 7:00 AM (GMT +1).
- The most actively traded currency pairs during this session are the AUD/USD, NZD/USD, and any other currency pairs that contain the New Zealand and Australian currencies.
- Given that they are the key currencies affected during this session, the EUR/JPY is the best currency pair to trade.
- You need to know that you can’t make so much profit during this session because the total amount of money traded at that time period is small compared to other sessions and the spread during is wider.
- The forex opening time in Nigeria on Sunday starts at with the Sydney session by22:00 PM Nigerian time (GMT +1).
The Tokyo session in Nigerian time is between 01:00 AM and 10:00 AM (GMT +1).
- The currency pairs with the Japanese Yen (JPY), such as USD/JPY, GBP/JPY, and EUR/JPY are the most actively traded pairs during this session.
- Japan, Australia, Hong Kong, and Singapore are the major countries that participate during this forex trading session.
- With at least 16.8% of all forex transactions, the yen is the third most traded currency internationally and this session is the third-most crucial trading hub to watch out for.
- During this session, it is better to avoid trading major currency pairs like UR/USD and GBP/USD because the liquidity during this period is low and hence, you can’t make a good profit.
- The spread for major currency pairs during the session are wide. It is preferable you monitor the markets during the Asian session for major currency pairs and execute your trades in the London and New York sessions.
London (European Session)
Understanding the London trading session is important in picking the best time to trade forex in Nigeria. The London session in Nigerian time is between 08:00 AM – 05:00 PM (GMT +1).
- This is the largest trading session in the world and it accounts for about 42% of all forex trading globally.
- The two main participants are traders from Germany and London.London is the capital of currency trading.
- The London session is the most volatile trading session in the world due to the huge volume of transactions.
- Majority of trends begin during the London session and last until the start of the New York session.
- During the London session, the EUR/USD, GBP/USD, and EUR/GBP pairs are the most traded pairs. The majority of other currency pairs in the area do well throughout this session as well.
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New York (American Session)
The New York session in Nigerian time is between 01:00 PM – 10:00 PM (GMT +1).
- Although New York is the capital of stock trading, it is the 2nd largest center of operation for currency trading.
- Major currency pairs that include USD, such as EURUSD, USD/JPY, USDCAD, GBPUSD, and so on, are very profitable during this session.
- The major participants during this session are American and Canadian. This session accounts for 17% to 18% of the entire daily forex trading volume.
- Towards the end of the New York session, it is advised to avoid trading as the liquidity decreases because New York traders are closing their trading positions for the day.
|Trading Session||Nigerian Time (GMT +1)|
|Sydney Session||22:00 PM – 7:00 AM|
|Tokyo Session||01:00 AM to 10:00 AM|
|London Session||08:00 AM to 05:00 PM|
|New York Session||01:00 PM to 10:00 PM|
Overlap of Forex Trading Sessions in Nigerian Time
It is very important to know that trading sessions overlap, and during this time, the market’s trading volume increases and there is more money in circulation.
- Sydney and Tokyo Session Overlap: This is generally known as the Asian session. It occurs between 01:00 AM to 07:00 AM (Nigerian time, GMT +1). This session could set the trend for the upcoming London session. So, you can use this session to plan for trades to take during the London session. But it is not advisable to trade major pairs during this session because they usually have wide spreads as a result of less volume traded during this time.
- Tokyo and London Session Overlap: It occurs between 08:00 AM to 10:00 AM (Nigerian time, GMT +1). Because the London session has the highest currency trading session globally, the Tokyo and London overlap are very profitable due to its high liquidity, and the spreads are way tighter. You can basically trade any currency pair during this time, but the major and minor pairs see more transactions compared to the exotic pairs.
- London and New York Session Overlap: This overlap occurs between 1:00 PM to 5:00 PM (Nigerian time, GMT +1). The overlap between the London and New York session is the most liquid period of the day. The Best Time to Trade Forex in Nigeria falls during these two sessions overlap. Due to the high level of market liquidity, large and fast movements are evident.The price movements in the New York session either follow the trend of the Asian and London sessions or, they can reverse the existing trend.
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Best time to trade Forex in Nigeria
The best time to trade forex in Nigeria is when the London market opens (8:00 AM, Nigerian time, GMT +1) up until the overlap of the London and New York sessions, till around 5:00 PM when the London market closes. You should also know that currency pairs that consist of EUR, GBP, or USD are mostly traded during these hours and are very profitable.
During these trading hours is when the market is most liquid and trends are formed, there are several opportunities to quickly enter and profitably close positions. Hence, the period is ideal for day trading and even scalping. Swing traders can also find an entry point to enter the market during this period and close their trades after days depending on their trading strategy.
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In conclusion, the forex market is divided into 4 trading sessions with London having the highest traded volume and hence, more profit potential. It is very important to pick the best time to trade forex in Nigeria based on the currency you want to trade while keeping in mind that London and New York sessions, especially their overlap, are the best times to trade and currencies that contain USD, EUR, or GBP tend to have more volume and be more profitable during these times.
Let us know in the comments what time you trade forex in Nigeria and what currencies you trade during that time.