In this article, I will discuss the Best Forex Pairs To Trade During the New York Session.
As one of the most active trading periods, the New York session offers high liquidity and volatility, particularly when it overlaps with the London session.
I’ll explore which currency pairs are ideal for trading during this time and why they provide excellent opportunities.
Best Forex Pairs To Trade During New York Session
The New York session in forex trading is characterized by high liquidity levels and high volatility, making it the ideal time for such trading sessions.
Below are some of the forex pairs that generated the best profits during this session:
EUR/USD: This remains the most liquid pair and quite frequently the one with the low spreads, hence each trading.
GBP/USD: This pair is well known for its volatility; hence, it can give many chances of trading.
USD/JPY: This pair is very liquid, has low spreads, and can be traded during the New York session.
USD/CHF: This pair is also famous because of its liquidity and the course of the Swiss franc.
AUD/USD: This pair is not as volatile as some of the above pairs; however, it is still a good pair for day trading.
It is worth noting that all these pairs involve one of the currencies that is mostly traded in the New York session,
The us dollar, thus the reason for trading their pairs, exceeds safety currencies alone.
New York Session Key Takeaways
For novice Forex traders in New York, one of the important steps is to understand the Forex trading sessions and especially know when the New York market opens.
Actually, being the second-largest Forex hub after the New York, the USD earns itself a place in 90% of all trades, hence, it is over watched by foreign investors.
The movement in the New York Stock Exchange NYSE will directly affect the value of the dollar.
The overlap of the US and London markets presents opportunities since that is when the best trading will be undertaken, more so in the New York session due to the long trading hours. The main points are:
- The New York session is one of the most active due to its overlap with London.
- This includes liquidity, which induces a more productive and cost-effective execution of trades.
- The New York session presents an active market with numerous currency pairs and instruments that are traded extensively.
- For several hours, the New York session accompanies the London and Asian ones. Since they complete each other, they add to the volume and activity.
- 19% of all Forex transactions are done during the London session.
- 85% of trades depend on the Dollar bill, which is why it is active in the market.
- Liquidity and volatility tend to lose touch in the late hours of the afternoon.
Best Forex pairs to trade in New York Trading Sessions
In Forex trading, the best days to carry out trades will normally be on Tuesday, Wednesday, and Thursday since these days are mostly well-active in the market.
During peak activity, trading should be deeper to ascertain that there are more buyers and sellers, and these days in the week, more people trade and use them the most.
The most preferred times to execute trades are in the New York session, which entirely overlaps with both the Asian session and the London sessions, creating a time of high movement in the market and an increase in liquidity.
Where it is advisable to trade forex pairs in the New York session, one currency pair will focus on is high liquidity cross currency pairs.
These pairs enable traders to utilize different kinds of strategies with minimal exposure to gaps. They include:
- GBP/USD
- EUR/USD
- USD/JPY
- EUR/JPY
- EUR/GBP
These pairs perform even better where both New York and London markets are in business.
Volatile measures against the dollar should be adopted, and cuts to the dollar should, therefore, concentrate on the periods within the day that trade dollars most, which are the EUR/USD, GBP/USD, and USD/JPY pairs.
While trading such currency pairs, there is a possibility of making more money. Also, traders will need to change their strategies often.
For instance, the most traded currency pair, EUR/USD, offers high liquidity and low spreads. The currency pair GBP/USD is quite volatile with large price motions; on the other hand, USD/JPY provides small spreads with high sensitivity to trade-related figures.
To summarize, there is a high level of activity and volatility within the New York session, and there are plenty of opportunities to make helpful profits.
However, to make a profit, it is vital to focus on currency pairs that are sensitive to political and other changes, have a low spread, and have sufficient liquidity.
Currency Pairs Classification
In the Forex market, all currency pairs adhere to one specific rule – there are always two currencies involved, one being bought and the other one being sold.
Any other forms of exchange between the national currencies are out of the scope (there are options for exchanging money for other assets, but precious metals, for example). The regulation of the ISO also provides this.
We have broken down the currency pairs above, but it is not enough that only the prevailing currency in currency pair relations should be understood.
You have to know the step law of the currency and the type of currency pair in which it falls because that is what determines the order type to be used.
That’s right, on Forex, there are three main currency pairs:
Major currency pairs
Minor (cross) and
Satellite currencies
Now, let us explore the terms “direct currency pairs” and “inverse currency pairs.”
Direct currency pairs refer to the currencies expressed in the US dollar, New Zealand dollar, Australian dollar, and British pound (a currency code appears on the right).
Inverse currency pairs refer to the case when the quotation currency bears the codes of the US dollar, New Zealand dollar, and Australian dollar.
The British pound is on the left side of the quotation (this is the currency that the holder is buying).
For example, EUR/USD is a direct currency pair, whereas USD/CAD is an inverse currency pair.
Conclusion
In conclusion, it can be said that the New York session offers a good opportunity for forex trading, especially among people who look to trade currency pairs that have the US dollar in them.
Currency pairs that quote the Euro and the US Dollar, the British Pound and the US dollar, and the Japanese Yen and the US dollar are highly liquid and active in response to market developments, hence beneficial in reaping from trading strategies.
By overlapping the London and New York trading sessions, it is possible to benefit from lower spreads and more volume of trade.
Identifying the better pairs to trade and keeping track of major economic news can help greatly improve the chances of making profits during the New York market session.
