What is the Best time to Trade Forex in Malaysia?

The Forex market remains open throughout the day; however, specific hours may not suit a few traders. Forex is a market for trading global currencies, and currency volatility depend on the active trading regions.

The currency pairs move during different sessions. Therefore, day traders focus on the market liquidity and volatility, whereas trend traders concentrate on entry and exit timings. The latter would prefer high volatility markets to earn movement profits.

Grasping the timing concept can become challenging for new forex traders, and they should consider variable regional trading session timings. The best trading time would depend on the region wherein the trader is located.

Forex Trading Sessions in Malaysia Time

Tokyo, Sydney, London, and New York are the four significant global forex market trading sessions.

The beginning and end timings of these markets are based on the local Malaysia time and are easy to establish through Malaysia Time.

Forex Market Open Time in Malaysia

The opening timings of Sydney, Tokyo, London, and New York trading sessions are 2:00 AM, 3:00 AM, 11:00 AM, and 4:00 PM. On the other hand, winteropening timings for these sessions are 1:00 AM, 03:00 AM, 12:00 PM, and 5:00 PM.

Forex Market Close Time in Malaysia

The closing timings are 11:00 AM, 12:00 PM, 8:00 PM, and 1:00 AM during summer. And closing timings in winters are 10:00 AM, 12:00 PM, 9:00 PM, and 2:00 AM.

The trading sessions of the world’s major financial hubs have correspondence to the general timing zones. The trading in Asia, Europe, and America reach the highest volumes during active trading sessions of Tokyo, London, and New York. The American forex market drops significantly during 11:00 PM and 2:00 AM (Malaysia Time) as the American workforce returns home from work.

Meanwhile, New Zealand and Australian workers are beginning their day. The above scenario is weekdays only as the forex market remains closed during the weekends, Christmas, and New Year’s. The working hours ultimately increase the dependency on the selected trading sessions. For example, people in Asia prefer Tokyo, Singapore, or Australian sessions.

Trading during an extensive session is more profitable than others. Focussing on an extensive session helps to understand movements and keep a time zone based track on the news related to them. Additionally, traders can limit the duration of buying and selling currencies. Optionally, focussing on overlapping trading sessions is also profitable as the duration causes higher liquidity.

Moreover, overlap sessions also increase regional market activity. For example, Tokyo and London sessions overlap between 12:00 PM and 1:00 PM (Malaysia Time) during summer. Similarly, London and New York sessions bundle together between 5:00 PM and 9:00 PM (Malaysia Time) during the entire year. According to a source, market movement is substantially highest during the London session.

Forex traders cannot ignore the importance of active market movement. The peak timings for New York, Tokyo, and London sessions are 5:00 PM (Malaysia Time) to 2:00 AM, 4:00 AM (Malaysia Time) to 1:00 PM, and 12:00 PM to 9:00 PM (Malaysia Time). Moreover, the timings may vary based on daylight saving timings of different countries.

Peak Forex Trading Timings

The peak forex trading timing depends on the local time zone. The best timing may vary for traders in Africa and Japan. Besides this, traders should also rely on the volatility and liquidity of the forex market. For example, activity slides down during the Sydney session, whereas it increases during the opening of Tokyo trading.

As mentioned earlier, the London session has the highest liquidity because many multinational banks have the banks in England’s capital. Therefore, traders undergo a similar experience during the New York session. Besides this, the best timings also vary on the chosen currency and the currency pair. Therefore, traders need to find the best timings based on the local working hours.

For example, Forex traders in Malaysia time zone would experience during the London session, corresponding to their working hours. So, African traders should trade during the same session. In Malaysia, EUR/USD is the most popular currency pair for Malaysian traders. The London Session has the highest trading volume for the above currency pairs.

So, traders will experience higher volatility for EUR/USD currency pairs during the London session. Meanwhile, traders in Asia have diversified peak timings. Moreover, the best trading sessions for a trader in Japan, Australia, and New Zealand are Japanese, Australian, and Tokyo.

On the other hand, the volatility of South East and South Asia traders for their pairs would be sufficiently lower in their time zones. As a result, they can trade in either New York or London sessions. Likewise, Japanese currency traders would find higher currency exchange during the Tokyo session.

London session is the best for UK and EU traders because it offers minor volatility, especially during Frankfurt trading hours. US dollar pair volatility is highest during the New York trading session. A key point to remember, especially for new traders, is avoiding trading during low liquidity markets.

Under low liquidity markets, the currencies can become highly small or stable. Therefore, market movement comprehension would become challenging for traders. Under such circumstances, currency pairs’ technical analysis and fundamentals don’t work as the market moves are often random.

According to a source, the New York exchange is essential for foreign investors as the USD pairs with 90% of global currencies. Therefore, the training market has a possibility of experiencing a ripple effect. Trading volume and volatility can spike due to military or political crises arising during slow-moving hours.

The source also suggests that the New York and London exchanges account for more than 50% of all forex exchanges. Moreover, the Singapore & Sydney exchanges have comparatively lower trade volumes than New York & London exchanges due to the timings. Also, the assumption is based on the fact that no significant news broke during the trading hours and can account as an exception.

Moreover, Consumer Price Index (CPI), consumer confidence, trade deficits, and consumer consumption are a few factors that have steady, scheduled release and move the market. Traders can benefit by keeping track of news related to these forms of economic data. London sessions are the most suited for traders, and the latter should even consider London and New York session overlap.

Also, the worst timing for trading is between the beginning of the Sydney session and the end of the New York session. According to a Citibank study, 30% of traders in the retail business break-even better, and 84% believe in making money in the forex market. Moreover, currency trades consist of 1000 to 1 and other high average rates.

Also, the ratio might seem like a profit opportunity and even offers investors the risk of losing financial security on a single trade. So, new forex investors should open demo platform accounts with mock trades, profits, and losses. Traders can become seasons should start with a real account.

Why is it Not Recommended to Trade Forex in Odd Timings

Most beginners in the forex market often wonder why can’t they trade anytime they want forex market remains active 24 hours a day. The truth is you can trade on any currency pair at any time you want (on weekdays) but there will be consequences while trading at odd hours.

• When the financial markets and businesses of a country are inactive, there are lesser exchanges of currencies on a global scale.
• Hence, when a trading session is not active, the liquidity on the currency pair will be low. This will increase the spread.
• Liquidity and spread are the major reasons why it is better to trade a currency pair during a particular time.
• Under low liquidity markets, the prices of currency pairs can be highly volatile and may not move at all. Therefore, market movement comprehension would become challenging for traders.
• Under such circumstances, currency pairs’ technical analysis and fundamentals don’t work as the market moves are often random.
• Eventually making profits in such a market would be extremely difficult and trades can be a gamble.

Overlap in Forex Trading Hours and The Role of Spread

The forex spread is the difference between the buy/ask and sell price and is calculated based on the pip value. For example, if the buy and sell prices of EUR/USD are 1.4398 and 1.4404, the difference is 0.0006, and the spread is calculated up to the fourth decimal, so it is 0.6 pips. But, the value for Japanese Yen currency exchanges bears up to the second decimal.

Overlap sessions are the best for forex traders, especially in open markets. Such sessions offer more enormous opportunities due to higher price ranges. The three significant overlaps include happening globally during weekdays are as follows:

US and London

According to a source, 70% of market trades happen during the US and London session overlaps because it involves two significant currencies: USD and EUR. The timing (9:00 PM to 1:00 AM (Malaysia Time)) is optimal for trading due to high volatility/price activity.

Sydney and Tokyo

Traders may not expect as high trading as US and London exchanges because the Sydney and Tokyo overlap (2 AM to 4 AM EST) does not have the same volatility; however, they can expect high pip fluctuation. Also, EUR and JPY are two significant currencies influenced during this tenure.

London and Tokyo

The London and Tokyo overlap (3:00 PM to 5:00 PM Malaysia Time) is the least significant because most US traders remain asleep, and one hour is insufficient for making significant pip changes. Therefore, traders should expect minimal action during this session.

However, trades can significantly alter with big news or scheduled announcements. Therefore, anyone interested in making a profit should follow global news that might directly impact different sessions, especially the overlaps, and calculate pips accordingly.

Conclusion

Traders can make more informed decisions by understanding the spread and currency pair movements during trading sessions. The first impression might seem complex; however, in due time, understanding would become more accessible. Moreover, a high volatility session may not often prove profitable for traders.

As mentioned earlier, high volatility comes with higher risk and low margins. Therefore, demo account trading is much more helpful to obtain self-confidence and understand trading structures. The best trading time is between 9:00 PM to 1:00 AM (Malaysia Time) like New York, and London exchanges overlap.

The two centers are responsible for more than 50% of the forex trade. Also, 6:00 PM to 7:00 AM (Malaysia Time) will experience a low trading window in the New York and London exchanges as the Singapore and Sydney exchanges have started operations.

The USD is involved in almost 90% of currency exchanges, and therefore, it is more profitable to trade during overlaps or respective country’s session. Conclusively, keeping these factors in mind would reap benefits for traders.