One of the most liquid trading sessions in the Forex market is the New York session. Its high liquidity makes it popular amongst traders across the world. The most liquid session of the day happens when the US session overlaps the London Forex session.
New York session forex
The official hours of the New York Forex Session are from 8:00 AM EST to 5:00 PM EST. In GMT, the New York forex session runs from noon to 9 PM (GMT).
Winter and Summer trading times are different, so:
New York session time is from 12-21 GMT during spring or 13-22 GMT during winter. The New York session time is from 8-17 EST during spring or 9-18 EST during winter.
The official hours of the London Forex Session run from 3:00 AM ET to 12:00 PM ET. New York and London have different time zones, but they overlap each other once every day, creating the most liquid session. This happens between 8:00 AM and 12:00 PM (ET).
The US session can very well trade like its European counterpart during this overlap.
The opening hours of the New York session witness more volatility than the other half of the day. You can employ different methods to capitalize on these different volatility levels.
Trading the Overlap: The NY Breakout Strategy
The US and the London Forex sessions are the big guns in the world of Forex trading. When they overlap, they create several opportunities. During their shared four hours, the two markets witness fast and large movements because high liquidity is present in the market.
The most successful strategy that a trader can employ during this overlap is the break-out strategy. This strategy allows you to reap the maximum benefits of this time period.
The New York Session: Trading in the Other Half of the Day
As soon as the London session is over, the volatility decreases drastically. Traders spend fewer hours in the market that ultimately decreases the liquidity as well. Along with decreased hours registered by the traders, the moves also become smaller. Even though the other half of the NY session is not as lively and volatile as the first half, there are still ways to profit. All you need to do is to change your strategy.
Instead of using the break-out strategy, move ahead with strategies like the range trading strategy. With a strategy like this one, you can use the resistance and support levels to your advantage.
Strategies like range trading are more successful in the other half of the trading day because as the volatility lowers, it becomes tough to break the support and resistance levels. Because of this, range trading is more likely to benefit you.
There are several pairs that you can successfully trade during the NY session. Given that the NY session and the London session overlap for four hours, most major currency pairs have USD, EUR, and GBP.
The best pairs to trade during the New York session
The best pairs to trade during the New York Session because of excellent volatility and trend following direction are:
These pairs are liquid, to begin with, but they become more liquid during the overlap.
Every Forex trading session comes with its share of unique characteristics. The market begins with the NY session, which is chased by the London session. Finally, the London session is tracked by the Asia session.
Whenever the market has high liquidity, trading will be lower because of the reduced spreads. Since the overlap witnesses a combination of high volatility and liquidity, traders find plenty of opportunities to make profits.