Understanding the different forex trading sessions can be a game-changer. Today, let’s dive into the Asian forex session, also known as the Tokyo session, and how it affects trading in Nigerian time.
The Asian session is one of the four major forex trading sessions, and it’s particularly important because it’s the first market to open after the weekend, setting the tone for the currency markets for the week. The primary market for the Asian session is in Tokyo, but it also includes other financial centers like Hong Kong, Singapore, and Sydney.
- The Asian session is known for its lower volatility compared to the London or New York sessions. This might seem less exciting, but it offers a more controlled environment for beginners to get their feet wet without the wild swings found in more volatile sessions.
Asian Session Forex Time in Nigeria
The Asian Forex session typically runs from 11 p.m. to 8 a.m. Greenwich Mean Time (GMT). Now, Nigeria operates on West Africa Time (WAT), which is UTC +1 hour. This means Nigeria is one hour ahead of GMT.
Therefore, to convert the Asian session to Nigerian time, you simply add one hour to the GMT times of the session.
Here’s how the Asian session times translate to Nigerian time:
- The Asian session opens at 11 p.m. GMT, which is 12 a.m. Nigerian time (midnight).
- It ends at 8 a.m. GMT, which is 9 a.m. Nigerian time.
So, for you in Nigeria, the Asian forex session would be active from midnight to 9 a.m. This timing is crucial because it means that the session opens when most people in Nigeria are deep asleep and closes mid-morning. So, if you’re an early riser or a night owl, you could take advantage of the trading opportunities this session offers.
Trading at night comes with its unique set of challenges, but with the right approach, you can turn these challenges into opportunities.
- Stay Alert: Since you’ll be trading at night, it’s crucial to ensure that you’re well-rested and alert. Fatigue can lead to poor decision-making.
- Monitor the Spreads: Brokers often increase spreads during the night due to lower transaction volumes. Be sure to keep an eye on this to ensure your trading remains profitable.
- Stay Informed: Keep up with economic news and updates that could impact the forex market. Major economic events in the Asian region can cause significant market movements.
- Use Technology: Use forex trading platforms that allow you to set alerts and automate certain aspects of your trading. This can help you manage your trades effectively without having to stay awake all night
Why Trade During the Asian Session?
The Asian session is known for its lower liquidity and volatility compared to the European and North American sessions. However, this doesn’t mean there aren’t opportunities.
The yen, being the third most traded currency, sees a lot of action during this time, and currency pairs involving the yen can have decent movements.
- Pairs like USD/JPY, GBP/JPY, and EUR/JPY are some of the best currency trading pairs during the Asian session.
If you’re looking to trade these pairs, you’ll want to pay attention to the economic releases and news events from Japan and other Asian economies, as these can cause significant price movements.
How to Trade the Asian Session Forex
Trading the Asian forex session requires a good understanding of the session’s dynamics, the right choice of currency pairs, and the application of effective trading strategies.
Some strategies have proven effective during the Asian session. One such strategy is focusing on the AUD/JPY pair, which is one of the most volatile pairs during this session.
You should determine the overall trend and wait for a breakout in the direction of the trend.
Another strategy is the Tokyo open strategy, which involves trading around the start of the Tokyo trading session.
The momentum strategy, which involves following the market’s momentum, and the carry trade strategy, which involves borrowing in a low-interest-rate currency and investing in a high-interest-rate currency, are also worth considering.
Tips for Trading the Asian Session from Nigeria
- Understand the Characteristics: The Asian session is less volatile, but it can still provide good trading opportunities, especially when economic data is released.
- Choose the Right Pairs: Focus on pairs that involve the Japanese yen, as they tend to be more active during this session.
- Monitor Overlaps: The Asian session overlaps with the late hours of the North American session and the early hours of the European session. These overlaps can lead to increased volatility and trading volume.
- Use Technical Analysis: Since the session is generally quieter, technical analysis can work well. Look for ranges or trends that may develop during the session.
- Be Mindful of the Time: Remember, the session runs from 12:00 am to 10:00 am Nigerian time. Plan your trading schedule accordingly.
- Stay Informed: Keep an eye on the economic calendar for Asian market events that could impact volatility and trading opportunities
Best Currency Pairs for the Asian Forex Session
During the Asian session, it’s wise to consider pairs that involve the Japanese Yen (JPY), given that Japan is the third-largest forex trading center. Pairs like USD/JPY, AUD/JPY, and EUR/JPY are among the best to trade during this time. The Australian Dollar (AUD) and New Zealand Dollar (NZD) also see stronger moves, as they are part of the Asia Pacific region.
