During a 24 hour period, there are 4 trading sessions for forex traders, all overlapping at different times during the day. The New York session is when the US Markets open and a huge amount of liquidity and volume floods into the markets. It’s important to understand which opportunities and currency pairs you should be focusing on during these hours. So, which forex pair is best to trade during the New York session?
The best forex pairs to trade during the New York session are USD, EUR and GBP pairs. Major crosses like GBPUSD and USDJPY are going to have a huge amount of liquidity and volatility, making them perfect to trade for forex traders. Currency pairs that won’t be affected by the NY session, like AUDNZD, should be avoided. Let’s find out more…
Choosing A Forex Pair During The New York Session
Choosing the correct forex pair to trade during the New York session is key. In this chart, we are looking at GBPUSD on the 5 minute chart. The box on the left is the London session, before NY opens. we can clearly see a fairly ranging market with relatively low volume on the lower chart. When NY opens, we can see a huge move to the downside and a massive increase in trading volume. Being on the right chart at the right time is key to capitalising on this.
Staying on currency pairs that include USD, CAD, GBP and EUR is going to be the best idea. These currencies are going to have the most volume and hopefully the least amount of consolidating price action. For New York session, major currency pairs are going to respond very well to price action too. These will include:
I would recommend avoiding Exotic pairs during the session and stick primarily to USD currency pairs, as we are trading the US trading session.
When Is The New York Trading Session?
The New York or US trading session starts at 12:00 UK Time. The session then runs on to 20:00 UK Time. The first few hours of the session will certainly have the most volume as there is a crossover with the London trading hours. The London session has the highest volume and liquidity in the markets, so those first 3 hours of the NY session will yield the best trading results.
Trading more forwards the end of the session is usually much harder due to higher spreads, lower volume and more ranging markets. You’ll typically find that when there are more participants in the market, I.E at the start of the New York session, you’re less likely to see ranging markets and you’ll be more likely to capitalise on good opportunities.
During the New York open, at 12:00 UK Time, you’ll see a large spike in volume and currency pairs will typically start moving a lot more than previously. For instance, you’ll notice an increase in pip movement on pairs like EURUSD and GBPUSD so you’ll need to keep an eye on stop losses for any open positions in the market that were opened pre NY session.
Is New York The Best Session To Trade Forex?
The New York session is not the best session to trade forex, objectively. However, the crossover between the London and New York sessions is always a volume packed few hours where there is typically a lot of good opportunities.
For instance, in the chart above we are looking at Gold (XAUUSD) on the 5 minute chart. On the bottom of the chart, we can see the volume, per candle. Forex is decentralised so volume isn’t too useful and needs to be taken with a pinch of salt but we can clearly see that when the New York session begins, volume picks up massively and a large move takes place.
I would say that most successful forex traders do trade the first few hours of the New York session, because the London session is the best session to trade, so the overlap works well. Picking the correct pairs to trade will also make a huge difference, for instance, trading XAUUSD during New York open is a much better idea than trying to trade the pair on Tokyo open.
In Conclusion, Which Forex Pairs Are Best To Trade During New York Hours?
In summary, during the New York session, Major USD currency pairs are going to be the best forex pairs to trade. These will include GBPUSD, USDJPY, USDCAD, EURUSD, AUDUSD, USDCHF and XAUUSD. The USD pairs will have the most volume, the most liquidity and provide the best trading opportunities.
The first few hours of the New York session will be the most valuable for forex traders, as the volume from the London session will still be having a great effect on the markets and the currencies you’re looking to trade.
If you have anything to add please do leave a comment down below!