Forex Trade in Nigeria: Choosing the Right Timing for Successful Trading

Forex Trade in Nigeria: Choosing the Right Timing for Successful Trading

The Nigerian economy is strong and blossoming, so it provides plenty of opportunities for earning, investing, and making more money. Forex trading is one of the ways to multiply your savings, but there are many factors that impact the outcome of your trading. Along with choosing the right currency pair, you need to carefully calculate when to trade (and when not to trade). This article will help you keep track of the best trading periods by the Nigerian time and how to decide when to enter the trades and when to refrain from them.

Global Forex Trading Sessions A Trader Needs to Know

If you trade from Nigeria, you need to remember that major forex session times in Nigeria depend on the actual time of countries where these sessions are started and finished. So, the opening and closing hours of important trading sessions may not coincide with the regular working hours in Nigeria in general and the working time of the Nigeria Stock exchange in particular. And yes, you need to pay attention to the Nigeria Stock Exchange if your operations will include naira-based pairs. Nigeria uses the West African Time zone (GMT+1), so when seeing the GMT timetables, you need to convert them properly.

London Stock Exchange

Active hours: 07.00 a.m. to 04.00 p.m. (GMT). When converted, it is 08.00 a.m. to 05.00 p.m. (WAT).

We start with the London session forex time in Nigeria because it basically coincides with regular working schedules in Nigeria and is easy to follow. But the more important argument is that London is the capital of currency operations (like New York is the capital of stocks) and is responsible for about 42% of all forex trading happening globally. The volumes of trade are immense during this trading session. The exchange allows trading of several currency pairs, but it is the best time to work with EUR/USD and EUR/USD.

New York Stock Exchange

Active hours: 12.00 p.m. to 08.00 p.m. (GMT). In the WAT time, it is also the second half of the day, from 01.00 p.m. to 09.00 p.m.

Essentially, it is the USA-based chunk of forex trade, spanning over 17% of the global forex operations. It also provides big opportunities due to the high liquidity and volatility that occur during this trading time. If you need to know the US forex market opening time in Nigeria, it is the New York Stock Exchange that you are looking for. Since the US dollar is the domestic currency, key news impacting the prices of the dollar is released during this session. The exchange offers a variety of major and exotic pairs, including EUR/USD and GBP/USD, among others.

Tokyo Stock Exchange

Active hours: 11.00 p.m. to 08.00 a.m. (GMT). If we translate it into WAT time, it is 12.00 a.m. to 09.00 a.m.

This exchange and trading session are of particular interest to you if you plan to use pairs that include the yen (JPY). Tokyo session is responsible for 6% of the global forex turnover, so it is safe to call it the third most important trading location to watch. Interestingly, although the yen is the currency of Japan, the proximity of the economic giant – China – makes yen trade connected to important economic developments or political decisions made in China. So if you decide to try a hand at yen trading, never forget to check the news coming from this economic powerhouse.

Sydney Stock Exchange

Active hours: 12.00 a.m. to 06.00 a.m. (GMT). When presented as WAT time, it is 01.00 a.m. to 07.00 a.m.

These are ungodly hours for trading that requires you to be fresh and think clearly. However, AUD/USD is an important forex pair, and if you want to benefit from it the most, you need to prepare for the Sydney session forex time in Nigeria. Remember that Australia has an interesting position at the intersection of Western and Asian economic interests, and this continent-spanning country is a big commodity-exporting player itself. AUD currency can be sometimes volatile, and it allows you to reap some serious profits if you set the timing right.

Nigerian Stock Exchange Active Hours

The Nigerian Stock Exchange (NSE) is a reputable institution, or rather a conglomerate of companies and actors who trade stocks and other assets and commodities. NSE does not have a dedicated branch for private forex trading, but the decisions made at NSE impact the business and economic conditions nationally. So if you need to track some local developments and how they relate to naira or dollar exchange rates, you have to check it during NSE working hours.

The Nigerian Stock Exchange officially works 10.00 a.m. to 02.20 p.m. by WAT, with 10 minutes (till 02.30 p.m.) assigned as extended hours and imbalance closure time. The exchange operates on weekdays, Saturday and Sunday being days off.

Comparative Schedules Of Global Trading Sessions

Exchange Name Working hours, GMT Working hours, WAT
London Stock Exchange 07.00 a.m. to 04.00 p.m. 08.00 a.m. to 05.00 p.m.
New York Stock Exchange 12.00 p.m. to 08.00 p.m. 01.00 p.m. to 09.00 p.m.
Tokyo Stock Exchange 11:00 p.m. to 08 a.m. 12.00 a.m. to 09.00 a.m.
Sydney Stock Exchange 00.00 to 06.00 a.m. 01.00 a.m. to 07.00 a.m.
Nigerian Stock Exchange 09.00 a.m. to 01.20 p.m. 10.00 a.m. to 02.20 p.m.

When these timetables are put together, it’s easier to see what the most active forex trading time in Nigeria is and how to match it to your local schedule. Such alignment also leads to the conclusion that some sessions overlap and some don’t. Overlapping hours are crucial in trading because they provide doubled levels of liquidity and trading activity, thus opening more windows to money-making.

Hours When Trading Sessions Overlap

Overlaps of trading sessions are usually cited as the best forex market timings in Nigeria for a profitable trade. Oftentimes, it is true. So what time should be on your alarm clock?

There are important overlaps that you should remember.

The overlap between the London Stock Exchange and the New York Stock Exchange happens between 12.00 p.m. to 04.00 p.m. GMT. In WAT, it is between 01.00 p.m. and 05.00 p.m. The time mostly relates to your regular daytime, but it may be a problem if you work and have to juggle your job and trading.

Another overlap is between the Tokyo Stock Exchange and the London Stock Exchange. It provides the window from 07.00 a.m. to 08.00 a.m. GMT (08.00 a.m. to 09.00 a.m. WAT). While planning your trades, remember about daylight saving schedules and double-check the exact GMT time in the country where the exchange is located.

Overlaps of trading sessions are usually cited as the best forex market timings in Nigeria for a profitable trade. Oftentimes, it is true.

Why Is It Important To Observe Proper Trading Hours In Nigeria?

What flows from the mentioned schedules is that the interplay of major trading sessions makes the global forex market work all around the clock. So theoretically, you may enter the trades any time of day or night without worrying about when forex market open in Nigeria.

However, if you plan to maximize the outcomes of your activities, you need to pick the moments that provide the best trading opportunities.

Such moments usually happen at the beginning and end of the trading period, when liquidity rushes in and volatility is visible. Definitely, the first half an hour of the forex market opening time in Nigeria is not the best time to dive headlong, but after half an hour of the initial chaos the volatility is still there, and you can try to catch the wind and earn some money. When the liquidity is high, spreads are low, so even this condition is already a way to save money.

In addition, such major pairs as EUR/USD or GBP/USD are better traded when their native exchanges are active. Since EUR and GBP belong to the European area, they are better traded when the London session is in motion. USD makes up almost 90% of all forex trades, so no matter when you trade, you will depend on it. So watch the news rollouts in the USA, which usually happens when the New York exchange is operating.

All in all, pay attention to the London and New York sessions, including their overlap. It means that the time span from 08.00 a.m. to 09.00 p.m. is optimal, with opening and closing hours providing higher spikes in prices and more opportunities (and risk, remember it). Overlap happens from 12.00 p.m. to 04.00 p.m., so this is the period of the highest liquidity and positions being open or closed (depending on bullish or bearish sentiments of traders).

Get free daily updates on four major currency pairs, stock indices, and commodities.

Time Points and Dates When Trading Forex Is Not Recommended

Just as there are times when operations can be more successful and profitable, there are periods when you’d better refrain from trading because of high risk. Slumbering markets or unexpected price changes can negate your efforts and bring your assets down to zero. That’s not what you expect from forex trading, so keep track of time slots when trading is not recommended.

  • Moments of unexpected price fluctuations.

    Although price spikes and falls can be predicted by certain markers and events, there are times when the market behaves irrationally and most traders don’t know what to make of it. The underlying reason may be some kind of unexpected event you don’t know about yet or a market manipulation on a large scale. No matter what, don’t engage in trading until the market settles down. Opening positions is very risky at such moments.

  • Dates or times when some important announcements are to be made.

    These announcements may include economic news, news coming from the private sector but impacting the economy at large, and new fiscal regulations, like NFP announcements or annual interest rate hikes. When such big rollouts are made, prices behave wildly. So a whole day may be crossed out from your trading schedule. Also take care to follow the key addresses delivered by heads of London bank, European Central Bank, and the Federal Reserve. Decisions of these institutions impact the exchange rates around the world, so the waves from this news will make markets volatile. So again, take a day off from trading when these representatives are speaking.

  • Big banking holidays.

    These are the special days when even big banks are closed, and the exchanges do not work either. So basically, the whole forex trade comes to a halt. It happens when these holidays are in the USA or the UK, the countries that accumulate the lion’s share of all global operations. These days are not numerous, they fall on different dates in different countries, but be sure to mark them on your calendar, because on these dates liquidity of the dollar and euro may be low and volatility insignificant.

  • Weekends.

    Forex trade traditionally stops for weekends, so from Friday to Monday, you won’t be able to trade actively as well. The trades resume at 00.01 (GMT+1) on Monday, so use this free time to rest and recharge. Then you will start a new trading week in full armor.

  • Opening and closing hours of trading sessions.

    The previous advice comes with a warning: if you decide to try trading right when the forex session begins, think again. Wait for one hour after opening until the initial rush settles and the news that arrived over a weekend gets incorporated into the pricing. Then proceed with analyzing the trends and opening your positions. The same applies to the forex market closing time in Nigeria on Fridays. Many traders tend to close their positions before leaving their trading console for two days, and prices may get unpredictable as well. However, soon they will return to normal and you’ll be able to trade without excessive risk.

Forex Trade in Nigeria: Choosing the Right Timing for Successful Trading

Defining The Best Time For Trading A Specific Currency Pair

Ideally, the best time for forex trading in Nigeria is when liquidity is flowing freely, spreads are low and volatility is reasonable, but not excessive. However, this description is too broad. To narrow it down, consider what currency pair you trade: does it involve GBP, EUR, JPY, or AUD?

Usually, conditions for trading GBP/USD and EUR/USD pairs are best when London and New York have their exchanges running. So, aim for London or New York sessions, or for their overlap that provides a particular boost and abundance of cash and price movement.

If you want to work with USD/JPY or AUD/USD, look to Tokyo or Sydney sessions.

If you need to survey the fluctuations of the naira prices, it is reasonable to watch the development at the Nigerian exchange. Fortunately, its trading time almost completely correlates with the London session, which makes the task easier.

Forex Trading Success And Its Relation To Time

If we try to put it all together in a concise form, we will arrive at the following set of recommendations:

  • Refrain from trading on the days of big news, annual bank addresses, or other major events that can foreseeably make the markets run amok.
  • Refrain from trading at the week-opening and week-closing hours.
  • Be careful when the markets behave unexpectedly for unknown reasons.
  • Match your currency pairs and the hours to trade. Overall, the sessions of the London and New York Stock Exchanges are the best time to trade, particularly their overlapping time slot. It is also the best EUR/USD trading time in Nigeria and around the world.
  • Keep an eye on the Nigerian exchange if your trades involve NGN.

The rules are not that numerous, but it’s hard for beginners to plan their trading and refrain from opening positions during the literal storms on the market. Storms are better spent in the safe havens, and it is then that the trading journey should begin.

This is why we aimed to provide instruction on the importance of the careful selection of trading time, and we hope that you will approach this part of trading responsibly.

Conclusions

Definitely, a lot depends on your particular circumstances, but there are essential rules that you need to remember about timing. Negligence and haste can harm your positions and leave you without a single cent. That’s not your goal in forex trading, we believe.

For this reason, we recommend that you read these timing rules carefully, and then do some practice with a safe demo account. You don’t risk money, you just learn to forge your way in the forex markets with confidence. And then, when you feel experienced enough, you can start investing real money with high chances of success. That’s the ultimate result we want for you, no less.

FAQ

Is It Worth For Beginners To Engage In Forex Trading?

We all are beginners at some point in our lives. We all receive education to get a job and make a career, learn to manage our financial matters, and think about increasing our income. That’s why forex trade is as fit for beginners as any other investment or financial activity. You need to get some basic education about its principles, and then you can practice in a demo account. After that – when you are not an absolute beginner – you can start trading with small amounts of money to get confident and develop your strategy. So if you start learning today, you will be able to start trading relatively soon.

Is There A Specific Time Of The Forex Market Opening In Nigeria?

The forex market works round the clock, but there are specific time points when major trading sessions open and close. On weekends, trades traditionally come to a halt. Be sure to check the timetable of major trading sessions to keep track of their opening and closing hours, as well as of the key overlaps. Remember that in the reference materials time is usually provided in GMT format and it should be converted into WAT (unless it is explicitly stated that the time is given in the WAT zone).

Is There Any Forex Session Running Active In Nigeria Right Now?

It is all very relative. Different trading sessions run day or night, so it depends on the time when you actually read this article. Look up in the tables above what trading session is active now. Some definitely is, if it’s not Saturday or Sunday.

Do I Need A Lot Of Time To Learn Forex Properly And Start Real Trades?

If you are a fast learner, it may take you a month or a bit more to master some theory and basic practical skills and start trading with caution. If after a month you feel that you are not confident enough, give yourself more time to study. You are going to invest money into forex trading, so you should not be careless, the price may be too high. So, assign yourself time with a good margin, practice and practice, and only then move on to real-life trading.

by Justforex, 2022.05.30

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