Best Pairs to Trade During New York Session
Hello Friends! Today, we’ll be talking about the best pairs to trade during the New York session. This session is the most liquid, volatile, and active trading session, with approximately 19% of all forex transactions occurring during this time. The New York session’s primary currencies are the US dollar (USD) and the euro (EUR). During this session, the market is influenced by economic news and data releases from the United States, Canada, and Europe. Therefore, it’s essential to know the best pairs to trade during this session.
EUR/USD
The EUR/USD is the most traded currency pair in the world. This pair is the favorite of many traders because of its high liquidity and tight spreads. The euro and the US dollar are the most significant currencies globally, and their exchange rate reflects the relative strength and weakness of their economies. During the New York session, economic data releases from the United States and Europe create high volatility for this pair. Therefore, it’s essential to monitor the economic calendar and news releases.
When trading the EUR/USD during the New York session, it’s crucial to pay attention to the US dollar index (DXY). The DXY is a measure of the US dollar’s value against a basket of currencies. When the DXY strengthens, the USD strengthens relative to other currencies, including the euro. On the other hand, when the DXY weakens, the USD weakens relative to other currencies, including the euro.
USD/JPY
The USD/JPY is the second most traded currency pair in the world. This pair indicates the strength of the US dollar against the Japanese yen. During the New York session, the USD/JPY is heavily influenced by economic data releases from the United States and Japan. Therefore, it’s crucial to monitor the economic calendar and news releases to identify potential trading opportunities.
The Bank of Japan’s (BOJ) monetary policy decisions can also affect the USD/JPY. The BOJ’s decisions regarding interest rates, asset purchases, and other monetary policy tools can have a significant impact on the exchange rate. Therefore, it’s essential to keep an eye on the BOJ’s announcements and statements during the New York session.
GBP/USD
The GBP/USD is the third most traded currency pair in the world. This pair reflects the strength of the British pound against the US dollar. During the New York session, the GBP/USD is influenced by economic data releases from the United Kingdom and the United States. Therefore, it’s imperative to keep track of the economic calendar and news releases.
Brexit-related news and developments can also affect the GBP/USD’s exchange rate during the New York session. Therefore, it’s essential to keep an eye on any news related to the United Kingdom’s departure from the European Union.
AUD/USD
The AUD/USD is another popular currency pair that is frequently traded during the New York session. This pair indicates the strength of the Australian dollar against the US dollar. During the New York session, the AUD/USD is heavily influenced by economic data releases from Australia, China, and the United States. Therefore, it’s essential to monitor the economic calendar and news releases to identify potential trading opportunities.
The Reserve Bank of Australia’s (RBA) monetary policy decisions can also affect the AUD/USD. The RBA’s decisions regarding interest rates, asset purchases, and other monetary policy tools can have a significant impact on the exchange rate. Therefore, it’s crucial to keep an eye on the RBA’s announcements and statements during the New York session.
USD/CAD
The USD/CAD is the fifth most traded currency pair in the world. This pair indicates the strength of the US dollar against the Canadian dollar. During the New York session, the USD/CAD is heavily influenced by economic data releases from the United States and Canada. Therefore, it’s crucial to monitor the economic calendar and news releases to identify potential trading opportunities.
The Bank of Canada’s (BOC) monetary policy decisions can also affect the USD/CAD. The BOC’s decisions regarding interest rates, asset purchases, and other monetary policy tools can have a significant impact on the exchange rate. Therefore, it’s essential to keep an eye on the BOC’s announcements and statements during the New York session.
Conclusion
In conclusion, the New York session is the most liquid, volatile, and active trading session. During this session, economic news and data releases from the United States, Canada, and Europe create high volatility for currency pairs. The best pairs to trade during the New York session are the EUR/USD, USD/JPY, GBP/USD, AUD/USD, and USD/CAD. It’s essential to monitor the economic calendar and news releases to identify potential trading opportunities. Furthermore, it’s crucial to keep an eye on central bank announcements and statements regarding monetary policy decisions. Happy trading, friends!
References:
- https://www.babypips.com/learn/forex/trading-sessions
- https://www.fxcm.com/markets/insights/best-time-to-trade-forex/
- https://www.investopedia.com/articles/forex/06/sevenfx.asp
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