Optimizing Your Forex Trading Strategy: The Best Time to Trade Forex in South Africa for 2023

Are you thinking about starting trading forex? Are you already trading but want to enhance your results? Building an optimal schedule in accordance with the most active forex hours might give you a hand. This article is to provide you with a basic idea of the FX trading sessions schedule and help you find the best time to trade forex in South Africa for a particular currency pair.

Anyone can enter the forex market any time except on weekends and public holidays.

The Forex Market’s Hours of Operation

A beautiful aspect of forex is its round-the-clock availability. There is no such thing as opening at 8 and closing at 5, like in stock exchanges. Since currency exchange isn’t concentrated in a particular geographical area but takes place in many time zones, one can enter the forex market any time except on Saturday and Sunday when the market is closed for weekends. Also, the market closes on Christmas and New Year. Low trading activity is observed during other public holidays.

The 4 Major Forex Exchanges

Even though forex is a decentralized market, most of the trading volume is concentrated in several cities. They include Tokyo, Singapore, Hong Kong, and Shanghai in Asia, as well as London, Amsterdam, and Frankfurt in Europe. New York is a center for American currency trading. Sydney is a major center for the Australian dollar exchange. Being located in different time zones, these cities make four forex sessions. They are:

• Pacific session
• Asian session
• European session
• North American session

Follow the link to check the current schedule of each of the major trading sessions.

Worldwide Forex Markets Hours

The trading starts on Sunday evening (South African time) and lasts until 11:00 pm on Friday when the North American session closes. Each of the cities mentioned above has specific working hours. In the South African time zone, these working hours are:

The Best Time to Trade

The schedule above will help you pick the right time for trading. But before that, keep in mind four essential rules:

• Traders benefit from high activity in the market.
  So-called active hours of the forex market are the hours when the trading volume is the largest. Trading during those hours offers a few advantages to traders, including high liquidity, high volatility, and narrower spreads.
• The best time for trading depends primarily on the instrument you trade.
  Suppose you are interested in GBP/USD. In that case, you should concentrate on the London trading hours and the overlap of European and North American sessions, as the British currency’s price is more dynamic at that time of the day.
• The price of a currency pair is more volatile in the first hours of a trading session.
  It’s not always like that, but in general, the first 2-3 hours of the trading session are the most active ones. Thus, you should not skip them.
• Increased volatility may be triggered by important world events at any time of the day.
  Sometimes things just happen unexpectedly. For example, a huge container ship gets stuck in the Suez Canal and raises oil quotes temporarily. Anything from political turbulences to transportation problems or natural disasters may affect the markets off the schedule.

The best time for trading is determined by the instrument you trade.

The Best Time to Trade USD in South Africa

Over 90% of forex turnover involves the American dollar either as a base or a quoted currency. This is why we want to take a closer look at trades involving USD. The pairs that include the US dollar generally fluctuate the most around 2 pm – 5 pm. During those hours, the high trading volume is supported by two major markets that operate simultaneously (US and EU), creating the best opportunities for short-term positions.

High-Volume Trading Does NOT Guarantee Profit

One thing we would like to stress is that "active hours" convey "more opportunities for a profitable trade" but not the "profitable trade itself." There is as much chance to lose as to profit if the strategy doesn’t work or a trader makes a mistake.

Plus, there are long-term strategies that do not imply following the daily price fluctuations. If you adhere to carry trading or positional trading style, checking in during the "volatile hours" may not be worth the effort.

Demo Trade with JMarkets

If you are new to trading, we recommend that you try using a demo account on JMarkets. Demo accounts don’t require any deposits from your side – what you trade is virtual money. Here, not only can you determine the best time of day to trade forex but also backtest your strategy. This is proved to be the most effective risk-free way to advance your skills before making any financial investments.

If you are confident in your knowledge and skills, consider opening a real account. Trading with JMarkets will give you the advantage of low spreads, commission-free withdrawals, and round-the-clock customer support.

Conclusions

If you want to increase your profit from intraday trades, one thing you could do is trade during the most active hours of the day. By doing so, you can benefit from the high liquidity, increased price volatility, and sometimes narrower spreads. Although the first hours of North American sessions are considered the most active in general, the best time for trading depends on the currency pair you trade.

by JMarkets, 2023.04.24