The foreign exchange market is by far the biggest and the most actively traded financial market across the globe known to offer round-the-clock trading.
Continuous trading is possible on this market because it is traded across the world in decentralized locations.
Forex market hours are divided into four primary trading sessions – New York, London, Sydney, and Tokyo.
An understanding of market hours and the best times to trade in different sessions should help traders execute profitable trades without much effort to meet their goals.
In this guide, let us discuss the Sydney session forex hours and the best currency pairs to trade during this session.
Sydney Session Forex Pairs – A Complete Guide
The Sydney session is the first of the four Forex trading sessions and the most appealing aspect of this session is its opening and closing time.
This is why traders should find favourable movement in currencies at any time as compared to other sessions.
An understanding of the currency pairs available for trading, the best times to trade a session and the best pairs to trade during a session should help create a profitable trading plan and minimize risks.
Understanding Sydney Forex Pairs
Currency pairs show varying levels of activity and volatility during the trading day depending on the active traders in the market at any given time.
However, being aware of the Forex sessions helps us find out what currency pairs are the most active at what time.
For example, the GBP/USD and EUR/USD pairs are the most active during the New York and London session overlap, showing high liquidity and volatility.
However, these pairs are less volatile and liquid during the Sydney session.
There are several Forex pairs you can choose to trade during the Sydney session, the most common of which are AUD/NZD, USD/CHF, AUD/JPY, GBP/USD, EUR/USD, and USD/JPY.
The best times to trade these pairs depending on where you live and the currencies you are looking to trade.
For example, the best time to trade AUD/JPY is the most active trading hours of the Australian and Japanese markets which is generally between midnight and 6 am GMT.
Best Pairs To Trade During Sydney Session
Each Forex trading session has its currency pairs carrying their significance. As the Sydney session comprises Australia and New Zealand, Australian Dollar and New Zealand Dollar are the most moving currencies in this session.
While the best currency pair for you depends on where you live and trade from, there is a lot of movement between USD and JPY currency pairs.
Trading in these pairs should be profitable for traders.
Some of the most trending currencies include the Australian Dollar, Japanese Yen, and New Zealand Dollar as they are open in major markets these days.
While there are several currency pairs you can choose to trade in the Sydney session, two of the best pairs are USD/JPY and AUD/USD.
They are popular because of the high levels of volatility traders often look to benefit from.
USD/JPY
This pair shows the exchange rate between the Japanese Yen and US Dollar, dictating how many Yen you need to buy one dollar.
The two currencies are closely related to one another which means the value of one influences the value of the other currency.
This is the reason why the currency pair has a different rate of interest as compared to others.
Moreover, the USD/JPY currency pair is the most popular and liquid currency in the forex market.
AUD/USD
The AUD/USD currency pair has recently become the most traded pair, particularly in the forex market.
One of the reasons is that it is a combination of currencies from two beneficial economies namely America and Australia.
This pair indicates how many US dollars you need to get an Australian dollar and what the exchange rate is.
It is the most active trading pair these days and is the best pair for day trading considering its economic stability, performance, and high volatility.
Best Pairs To Trade During Sydney & Tokyo Session
The Sydney & Tokyo session is a period when both the Sydney and Tokyo sessions are open at the same time.
Such an overlap represents a busy time as more participants are active.
Traders can expect higher liquidity and volatility during this session, making it one of the best times of the day to enter a trade. The Sydney & Tokyo overlap occurs from 2 am to 4 am EST.
The Sydney & Tokyo Forex session is not as volatile as the US/London overlap but still offers an opportunity to trade.
The two most influenced currencies in this session are the Japanese Yen and Euro, so the best currency pair to trade during the session is EUR/JPY.
You can also consider trading AUD/USD during this session.
Such a market overlap is the best time to trade for those who like high volatility.
Sydney Session Forex Time
Forex market operates 24 hours a day, 5 days per week, across four different sessions with different trading hours.
So, investors from different parts of the world can trade round-the-clock throughout the weekdays.
The Sydney session opens at 22:00 GMT and closes at 6:00 GMT (opening time – 5 pm EST and closing time – 2 am EST).
This is when the trading day begins officially.
Though Sydney is the smallest of the markets, it sees a lot of action when the Forex market opens on Sunday noon as traders and institutional investors are looking to trade after the weekend pause.
The busiest time of the day for this session is 10 pm to 2 am in winter.
It is important to note that the forex session opening and closing times vary depending on the time of the year, as countries experiencing a change from daylight savings see a change in market hours in March, April, October, and November.
Final Thoughts
We hope this guide provides you with useful information about the Sydney Forex session and currency pairs traded in the session.
Many traders avoid trading during this session looking at its low volatility but you can create profitable trading strategies to benefit from the opportunities this session offers.
Choose from the best pairs for the Sydney session and pay attention to the best trading times to minimize losses and increase profits.