New York Session
Volatility tends to slow down during the middle of the London session. This is because traders go to eat lunch while waiting for the New York session to open. Once the European market players get back from their lunch breaks, the U.S session or New York session starts at 8:00 EST as market players start rolling into the office. Just like what Asia and Europe have, U.S session has one major financial center that the market players keep their eyes on. Now, what is this famous financial center that we’re talking about? You got it! It’s the New York session. This is considered to be the concrete jungle where dreams are usually made of.
Look at the table below. It shows the New York session ranges of the major currency pairs.
The values above were calculated using averages if past data from the month of May 2012. Depending on liquidity and other market conditions, these values may vary. Thus, considered to be not absolute values. If you are going back to the table, you will notice that the New York session range for EUR/CHF has not been included since the Swiss currency Franc has been nailed to the Euro at 1.2000 during that time.
Now what are the things that you should remember about trading during the New York Session:
1. During the morning, expect to have a high liquidity as it overlaps with the London Session.
2. Near the start of the New York Session, most economic reports are usually being released. It is clear that 85% of all trades involve the dollar. Therefore, whenever big time U.S economic data is released, markets have the highest potential to move.
3. Liquidity and volatility tends to slow down during the afternoon New York session once the European markets close the shop.
4. Expect a very little movement ever Friday afternoon. Both Asian and European traders and market players are usually out during this time.
5. Also on Fridays, there is the chance of reversals in the second half of the session, as U.S. traders close their positions ahead of the weekend, in order to limit exposure to any weekend news.
Which Pairs Should You Trade During New York Session?
Liquidity is very high during this time because both US and European markets are open at the same time. You can expect that banks and multinational companies to exhaust the lines. During this time, you as a market player can trade any pair virtually. However, it is imperative for you to stick to the major and minor currency pairs and avoid those weird ones.
Remember that U.S dollar id on the other side of the majority of the transactions, expect that almost all of the traders will pay attention to U.S data that will be released. If these reports come in worse or better than what anyone else expected, markets could be dramatically shake up as the dollars will be jumping up and down.
That’s all about New York Session!
Are you still confused on which sessions start when? Then it is just the right time to give you a clear understanding on session overlaps.
Proceed to the next lesson: Session Overlaps
Go back to the previous lesson: London Session
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