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The Asian session, when Europeans are asleep, is considered a more quiet time in the forex market. But the times they are a-changin – the Asian session is becoming more volatile. Here are the reasons for this change and who can benefit from it.

As the Greek crisis continues to be a dominant issue that dominates EUR/USD and other currencies as well, every statement made during the weekend and every international conference can create a different start to the week – currencies trade in a significant gap from the close on Friday. In most cases, this gap is filled, but it still creates lots of action, while it’s still Sunday in the US and night time in Europe. But it’s not only on Sunday:

The Chinese yuan isn’t traded, but as China is an economic superpower, every economic release from this giant has an impact on the forex market. Japanese and Australian figures have an impact on the local currencies, but Chinese figures tend to impact the dollar as well. With the ongoing Chinese growth, these figures will have a stronger impact on the markets.

Note that also other economies in the Far East have more impact: important events from India, South Korea and even Singapore have an impact on the markets.

Another contribution to volatility in the Asian session comes from the US: speeches from Federal Reserve officials that are delivered in the American evening, during the Asian session, also shake the markets. As the uncertainty towards the central bank’s monetary policy grows, every hint shakes the markets at these times as well.

For European traders that prefer sleeping during the night, this new action in the Asian session means that they should close positions if they want to have a risk free night. Making money while you sleep sounds good, but this may not necessarily be the case.

For American traders, this is an opportunity to trade during after hours. Most retail forex traders hold on to a day job, and don’t always like trading during work hours. The action in Asia happens during the evening time in the US. If you have a free evening, you can find the action in the markets.

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