Asian Session (Tokyo)
The forex week starts on Sunday evening with the Sydney session, followed by the Tokyo session. The Asian session is known for lower volatility and narrower price ranges compared to Europe and the U.S. Major pairs involving the Japanese yen, such as USD/JPY and EUR/JPY, dominate trading activity. The calmer conditions make this session suitable for range trading and scalping strategies, where traders can take advantage of smaller moves and tighter spreads.
European Session (London)
The London session is one of the most active periods in the forex market, as London remains the world’s largest financial hub. Liquidity peaks, and pairs such as GBP/USD, EUR/USD, and EUR/GBP often experience sharp movements. Volatility is high, making trend-following and breakout strategies especially effective. Traders should also be aware of the overlap with the Asian session at the start, when opening volatility can create additional opportunities.
U.S. Session (New York)
The U.S. session overlaps with Europe for several hours, creating the most liquid and volatile trading period of the day. Majors like EUR/USD, GBP/USD, and USD/JPY are highly active. Economic reports released during this session, including nonfarm payrolls, inflation data, and Federal Reserve decisions, heavily influence price direction. Later in the session, after European markets close, volatility tends to decline. This session is particularly attractive f…
Session Overlaps
Market activity is at its peak when sessions overlap. The Europe–U.S. overlap is the most active, providing high liquidity and frequent trend moves. The Asia–Europe overlap offers shorter bursts of activity. Understanding overlap times allows traders to plan their trades around the most dynamic hours of the market.
Strategies by Session
- Asian Session: Best for range trading and scalping.
- European Session: Ideal for trend-following and breakout strategies.
- U.S. Session: Works well for news-driven and momentum-based trades.
- Overlap Periods: High volatility and opportunity, but risk management becomes critical.
Conclusion
Although the forex market is always open, success depends on trading during the right sessions. The Asian session offers calm, the European session provides liquidity, and the U.S. session brings volatility. Matching strategies to the session’s characteristics enables traders to make the most of opportunities. In forex trading, timing is as important as strategy.