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Foreign Exchange Market operates 24 hours a day. One of the reasons is its global and decentralized nature. Forex market operates with different financial centers opening and closing at various times. Among these times, New York session is the most influential timeframes within forex market. Traders often find high-probability trading opportunities during these time windows.
This article explores understanding and essentials of New York trading session, and strategies used by smart money traders in trading London Session.
Overview of the New York Trading Session
New York trading session is also known as North American trading session. New York Session starts before the closing of London Session. This ensures continuous activity in the forex market. In forex market, New York trading session is considered as the heart of all trading session. This makes it the most impactful trading hub in the market. Institutional market participants from different continents also contribute to the market’s volatility.
According to Michael J. Huddleston, we need to look sessions and kill zones in New York time. In EST, the New York Session starts at 8:00 AM and ends at 5:00 PM.
New York trading session is more volatile and contains huge liquidity than London trading session. However, there is a high participation of traders and financial institutions during this session results in increased liquidity and price volatility. This makes it a prime time for traders to execute their high-probability trades.
Characteristics of New York Session
New York Trading Session has high volatility and liquidity. In trading liquidity refers to the availability of buy and sell orders. This is because of the presence of institutional traders, hedge funds and banks. New York trading session accounts for about 50% of the daily forex trading volume. Traders can execute large orders with minimal slippage and makes this session ideal for scalping and day trading.
In New York Session, market experience a strong price movements and trends. This indicates high volatility in market. Price action during this session often continues trend develop during London trading session range and creates new highs and lows. This session often forms new highs and lows for the rest of the day.
Economic releases from USA tend to create sharp price movements during the session. Key economic reports include GDP, NFP (Non-farm payroll), Inflation, trade balance, CPI, employment data, and interest rates. These reports often result in immediate price reaction.
Overlapping Session is the most important part of New York session. New York trading session overlaps with London Sessions. The overlapping time is the most volatile part of market. Smart money traders often find high-probability trade entries. New York Session overlap occurs at 8:00 AM – 12:00 PM EST.
Major Currency Pairs
It is important to note that not all forex pair or indices reacts in New York session. Forex pairs and indices that have some sort of relation with Europe and USA are recommended to trade in New York trading session. The top USD pairs include:
- EUR/USD (Euro vs. U.S. Dollar)
- GBP/USD (British Pound vs. U.S. Dollar)
- USD/JPY (U.S. Dollar vs. Japanese Yen)
- USD/CHF (U.S. Dollar vs. Swiss Franc)
- USD/CAD (U.S. Dollar vs. Canadian Dollar)
- AUD/USD (Australian Dollar vs. U.S. Dollar)
New York Kill zone: Institutional Trading Time zone
In Inner Circle Trader’s framework, New York kill zone is a critical time window within the New York trading session. New York Killzone starts at 7:00 AM and ends at 10:00 AM EST. In this time window, we primarily focus on liquidity exploitation around London session highs and lows.
Characteristics of New York Kill zones
The following are the characteristics of New York Session Kill zones.
- The London Killzone is known for liquidity sweeps and price manipulations. Liquidity manipulation takes place in the form of stop hunts around Asian and London Session highs and lows, and by taking previous day’s key levels.
- New York kill zone is highly volatile during US economic data releases that can cause sharp price reaction. Key events are Non-farm Payrolls (NFP), Consumer price Index (CPI), and data related to interest rate. Smart Money traders observe price action before and after these releases to confirm whether the price will continue or reverse an existing trend.
- New York kill zones contain high volume and institutional participation. High volume results in increased volatility. This makes the price action meaningful. As the volatility increases, manipulative price movements are created before the real move.
- There is a possibility that market shift its structure in New York kill zone.
New York Macros: A Comprehensive Guide
The concept of Macros in trading is introduced by Michael J. Huddleston. It is a time-based trading strategy that focuses on specific market behaviors within key trading hours. Like London trading session, New York session has six different time windows which reflect institutional activity.
New York Macro Timing
New York Macro times occur within the New York trading Session. This period of time is known for liquidity grabs and market reversals. The following are the timings of New York Macros in EST:
- New York AM Macro 1 starts from 08:50 AM and ends at 09:10 AM.
- New York AM Macro 2 starts from 09:50 AM and ends at 10:10 AM.
- New York AM Macro 3 starts from 10:50 AM and ends at 11:10 AM.
- New York Lunch Macro starts from 11:50 AM and ends at 12:10 PM.
- New York PM Macro starts from 01:10 PM and ends at 01:40 PM.
- New York Last Hour Macro starts from 03:15 PM and ends at 03:45 PM
Characteristics of New York Macros
In these time windows, market sweeps liquidity in to form of buy-side liquidity and sell-side liquidity. This liquidity seeking behavior is important in New York trading session and kill zone. The following are the characteristics of New York Macros:
- Price often sweeps liquidity and reverse.
- Price rebalances inefficiencies before continuing in the dominant trend.
- Trend shift occurs in the form of Market Structure Shift or Change of character, or trend continuation occurs in the form of break of structure.
Key Concepts for Trading New York Macros
To effectively trade with New York Macros, traders need to identify imbalances, liquidity zones, and short-term price direction.
It is important to analyze impulse price swing for Fair Value Gaps before a macro begins. Relevant timeframes for trading are 15-min, 5-min and 1-min. You can align your timeframes accordingly for analysis and for trade entries. FVG above price act as potential resistance zone. Price may move to fill inefficiencies before reversing. FVG below price serve as support zone. Price might drop to rebalance before resuming movement.
Liquidity zones are areas on price chart where a large number of pending orders and stop-loss reside. Buy-side liquidity contains stop orders above a previous swing high. Sell-side liquidity contains stop orders below previous swing lows.
Lastly, it is crucial to monitor price behavior during New York Macros. Macros trading is scalping-based. It does not require overall higher timeframe directional bias but rather short-term movements within the macro windows. If price takes sell side liquidity first, expect a reversal upward towards buy-side liquidity or an unfilled FVG. On the other hand, if price takes buy-side liquidity first, expect a drop downward towards sell-side liquidity or an unfilled FVG.
Trading with New York Macros provides a powerful edge for scalpers who understand liquidity sweeps, FVG, and algorithmic price movements. By aligning trades with macro timing and following a structured liquidity-based approach, traders can capitalize on predictable price movements.
Final Note
New York trading session is highly volatile with huge liquidity. New York Killzone and Macros occurs inside New York session. Mostly trading techniques and strategies are employed in New York session for high-probability trading. Traders must exercise discipline, test strategies on previous price action, and use proper risk management to protect capital. Forex trading involves huge risk and cannot be considered as suitable for all investors. Past price can help us in understanding price behavior but does not guarantee future results. Always trade with the capital that you can afford to lose. Seek professional’s advice before engaging in high-risk trading strategies.
Frequently Asked Questions (FAQs)
What is the New York Trading Session in Trading?
In trading, New York trading Session refers to the forex market activity during the New York trading hours. In New York Timing, NY trading Session typically starts from 8:00 AM and ends at 5:00 PM EST.
Why is the London Session important for Forex Traders?
There are multiple reasons for the importance of New York trading Session. Firstly, it accounts for majority of daily forex trading volume. Major currency pairs are EUR/USD, GBP/USD, and GBP/JPY.
I’m Abdullah Shah, a content writer with three years of experience in crafting engaging and informative content. My background in market analysis complements my work, allowing me to create content that resonates with audiences. I’m also a seasoned practitioner in the forex and crypto markets, with a strong foundation and deep interest in finance. My passion for the financial world drives me to produce content that is both insightful and valuable for those interested in understanding market trends and financial strategies.
