Fantastic currency #2: The Japanese Yen (USD/JPY)
This currency pair
has to be the most traded currency out of the whole of Asia.
Not only that, but it’s one of the seven most traded currency pairs in the Forex market. In fact, the Japanese Yen is the signature currency for Asia and is a significant reserve currency for many Asian countries.
As the Japanese economy and GDP grows, so does the demand for trading and investing in the yen.
In fact, there is so much demand, that each tiny movement in the Yen accounts for billions of dollars traded.
And this is exactly what we look for when it comes to trading Forex
. Strong liquidity (volume) equates to strong trends and movements in the market we can profit from.
When you think technology advancements, think of Japan
Another fantastic reason I love to trade the USD/JPY is because not only is it the oldest major economy in the world, but also it’s the most advanced economy.
When you go there you’ll see sky scrapers as far as the eye can see with the most advanced technology you can think of.
Neural networks, face and voice recognition, auto-climate and music changing rooms, top products advertised in full HD on the entire building instead of a poster.
And inside these sky-scrapers are brilliant minded and well-educated workforces. With Japan able to combat competition with prices and quality. This has resulted in significant exposure in the global economy.
And so as a global-risk-aversion currency the USD/JPY is seen as one of the safe-haven instruments that investors and institutions keep buying.
So what times are the best to trade the USD/JPY?
The Japan stock exchange opens at 1:00am our time and closes at 9:00am our time.
You might think! Timon, I won’t be up at 1:00am trading anything thank you very much.
I don’t blame you…
But the good news is, you don’t have to.
USD/JPY like the AUD/USD, is another currency that is so heavily traded that you can trade any time of the day.
While the Nikkei trades between 1:00am and 9:00am our time, the USD/JPY currency is a 24 hour, 5 days a week market.
You’ll see strong trends and movements anytime of the week.
And so, it’s another currency that doesn’t necessarily have more trends while the exchange is opened.
However, if you’d like to know when the best time is to trade, I can only tell you by experience.
Between 8am and 8pm, I find the best time to trade the USD/JPY. Any time after 8pm and the market seems to die out a bit, in terms of evident trends and movements.
And so there’s another fantastic currency pair that you can add to your watch list and when to trade it.
Stay tuned for the third currency coming in the next couple of articles…
“Wisdom yields Wealth”