The USA’s forex market is famous for its high volume and liquidity. Every trader across the globe wants to cash in on the tempting dynamics of the U.S. forex trading session, also known as the New York session. In this blog, I will discuss the U.S. forex session in India. There is a reason why traders across India want to understand the dynamics of this session. This is because of its high impact and the probability of making high profits.
Session Timings: The U.S. session begins at 5:30 PM Indian Standard Time (IST) and runs till 2:30 AM IST.
Reasons for high volatility: The U.S. session overlaps with the London session between 5:30 PM and 9:30 PM IST.
How U.S. Session is Convenient for Indian Traders
- The U.S. session starts at 5:30 PM IST, which is convenient for Indian traders. They can trade after finishing off their daily job routine.
- It is one of the most lucrative windows within the U.S. session when it overlaps with the London session. During this session, traders across the globe were active, and that is why the market experienced heightened activity.
1. Convergence of European and U.S. Trading Volumes
- Major traded currency pairs like EUR/USD, USD/JPY and GBP/USD see increased prices. This is due to the overlap of the two sessions, increased volumes, and high liquidity and volatility.
- Indian traders consider this time one of the best times to enter the market.
2. Advantage of U.S. Session
- The U.S. session has many advantages. It is fast-paced trading, which generates opportunities in response to many economic factors. Macroeconomic factors like inflation rates, employment figures, and GDP.
- The U.S. session is advantageous for traders who focus on news-based strategies. The market depends a lot on news-based sentiments, and any news can cause price fluctuation.
- The dollar is the most traded currency in the world, and any currency pair involved can experience sudden changes.
What is the U.S. Forex Session?
The U.S. session is also known as the New York session. It is one of the primary forex sessions. The other primary sessions in forex trading are as follows:
| Forex Markets | Trading Hours in UTC |
| Australia | 9:00 PM to 6:00 AM UTC |
| Asia | 11:00 PM to 8:00 AM UTC |
| Europe | 7:00 AM to 4:00 PM UTC |
| North America | 12:00 PM to 9:00 PM UTC |
Reasons U.S. Forex Session is a Primary or High Profits Session
- New York is the global financial hub. It has high trading volumes and offers good market liquidity.
- The dollar is the most traded currency in the world. Business and financial worlds consider the dollar as a preferred medium of transaction. Due to its high importance, traders like to get involved in forex trading during the U.S. session. Some other reasons can be,
| Factors | Influences |
| High Trading Volume and Liquidity | 1. New York is a global financial hub, and trading volume in the U.S. session is higher. This is due to the participation of major financial institutions, banks, and other corporations. 2. High liquidity during this session means tighter spreads and faster order execution. This increases the trading opportunities. |
| Major Economic Releases | 1. The New York session is marked and influenced by critical economic data releases. It can be the inflation rate, GDP, and Federal Reserve Announcements. 2. The U.S. dollar is the world’s reserve currency, and it is involved with major currency pairs. Any economic event in the U.S. affects global forex markets. |
| Movement in Currency Pairs | 1. Major currency pairs in the U.S. are USD/JPY, USD/CAD, EUR/USD, and GBP/USD. These currency pairs experience significant movement during the U.S. session. 2. You will be surprised to know that 88% of forex trades involve USD. This makes traders focus more on USD pairs. It is also one of the reasons the U.S. session plays a central role in setting trends for the day. |
| Extended Trading Hours | 1. The U.S. session runs from 8:00 AM to 5:00 PM ET. Around the globe, traders access this time range. 2. Traders of Asia, Europe, and other regions can access American forex markets during the evening or late-night hours. |
| Market movements | 1. The U.S. session when it overlaps with the London session is volatile. There is a sharp movement in the prices because both the European and American markets are active. 2. Traders consider this the best time to take quick gains from a trade. |
| Sentiments | 1. America is a major player in global politics, trade, and economics. Any geopolitical event has an impact during the U.S. session. 2. The session reacts to any political or economic news. It offers opportunities for traders who respond to market sentiments. |
The Best Time to Trade
- The forex operates 24 hours a day and has five working days. The market has round-the-clock availability because different countries’ financial sectors have different schedules.
- This implies that the Indian rupee is more active during its business hours. Similarly, the U.S. dollar is active later in the day. So, the ideal time to trade depends on the currency pairs you choose to trade. The table below shows the detailed schedule of major financial centres worldwide.
| Market | Opening (IST) | Closing (IST) |
| Wellington (New Zealand-Pacific Session) | 3:30 AM | 10:15 AM |
| Sydney (Australia) | 5:30 AM | 12:30 PM |
| Tokyo (Japan- Asian Session) | 5:30 AM | 2:30 PM |
| Hong Kong and Singapore (Asian Session) | 6:30 AM | 2:30 PM |
| Frankfurt (Germany- European Session) | 11:30 AM | 7:30 PM |
| London (U.K- European Session) | 12:30 PM | 8:30 PM |
| New York (The USA-North American Session) | 5:30 PM | 2:30 AM |
Best Forex Pairs to Trade During the U.S. Session
The U.S. trading session allows traders to capitalize on high liquidity and volume. Traders focusing on U.S. dollar-based currency pairs can take advantage of this session. Let us look at the best currency pairs to trade during the U.S. session.
1. EUR/USD (Euro and the U.S. Dollar)
- It is the most traded currency pair in the forex, especially during the U.S. session. It is highly liquid, which means traders can place trades frequently.
- The pair are ideal to trade during the American and European sessions as they are affected by both markets.
- The overlap between the U.S. and the London sessions is ideal for trade. The trade volume and volatility are highest during this period.
- The U.S. session overlaps with the London session between 8:00 AM and 12:00 PM ET or 5:30 PM and 9:30 PM IST.
Did you know? EUR/USD makes up to 24% of daily forex trades.
2. USD/JPY (The U.S. Dollar and Japanese Yen)
- The U.S. has closed economic ties and an influence on the Japanese economy. This is why traders trade the USD/JPY pair in the U.S. session.
- The pair experiences high volatility during U.S. economic news releases, such as GDP growth and interest rate changes.
3. GBP/USD (Great Britain Pound and the U.S. Dollar)
Did you Know? Traders know the GBP/USD currency pair as “the cable.”
- The currency pair is highly volatile in the U.S. session, particularly during the London overlap and U.S. economic data release.
- The best time to buy this currency pair is during the overlap session or release of economic data by the U.S. or U.K.
4. USD/CAD (The U.S. and Canadian Dollar)
- This currency pair performs well in the market during the U.S. session. This can be because Canada and the U.S. economies are closely linked.
- Canada, being a major oil exporter, influences the price of this pair through changing oil prices.
5. AUD/USD (Australian Dollar and the U.S. Dollar)
- The currency pair AUD/USD is more active during the Asian session. The pair is also popular in the U.S. session.
- The price fluctuation of this currency pair correlates with the commodity prices and economic news of both nations.
- Volatility in the U.S. market can spike with any announcement, which can impact global risk sentiments.
Tips For Trading During the U.S. Session (For Indian and Global Traders)
Traders consider the U.S. forex trading session one of the most volatile and liquid sessions. They can cash in on the opportunities generated during the session. Here are some tips for trading in the U.S. session.
1. Focus on USD Pairs
- The currency pairs like USD/JPY, EUR/USD, GBP/USD, and USD/CAD are active and more volatile during the U.S. session.
- 80% of forex trade happens through the U.S. dollar, so any U.S. economic event can influence these pairs.
2. Monitor New Economic Data Releases
Major data of the U.S. economy can have an impact on USD pairs. These economic data include GDP, inflation, the Federal Reserve, and retail sales.
Pro Tip: Check the economic calendar daily. Prepare yourself for high-impact news events and consider trading pairs affected by the news.
3. Take Advantage of the U.S and London Overlap
- Overlap time: 8:00 AM to 12:00 PM ET or 5:30 PM to 9:30 PM IST.
- This time, it has high trading volume and volatility. It will create more opportunities for quick price movements and tighter spreads.
4. Scalping Strategies in High-Volume Periods
- The U.S. opening session from 8:00 AM to 10:00 AM ET is the most active time of the day. It is an excellent time for scalping.
- Scalping strategies work well when there is high liquidity and volatility.
Currency pairs like EUR/USD and GBP/USD are suitable for scalping during the early U.S. session.
5. Range-Bound Strategies After London Close
- The market volatility and liquidity might decrease when the London forex session closes at 12:00 PM ET or 8:30 PM IST. This condition is perfect for range-bound strategies.
- During this period, a trader can buy at support and sell at resistance.
- Sellers should set shorter profit targets as the price movements are small.
Why Trade During the U.S. Session in India?
The U.S. session is appealing to Indian traders because of various reasons. Some of them are:
1. High Market Liquidity
The U.S. has been a global financial hub. Traders (buyers and sellers) worldwide are active during this session. Due to major involvement, the price fluctuation is smooth, and the chances for trade execution at the desired price are high.
2. Extended Trading Hours
For Indian traders, the U.S. trading session starts in the evening. This means they can trade after the Indian markets are closed.
3. Diverse Asset Options
The U.S. session offers assets like currency pairs, indices, commodities, and stocks. Indian traders can diversify their portfolios by trading these assets.
4. Access to Volatility
The U.S. session is highly volatile during an economic data release or global event. High volatility creates more trading opportunities. This is for those who like to earn profit from short-term price movements.
Conclusion
In this blog, we have discussed trading during the U.S. forex session in India. The forex session in the U.S. is the most liquid and volatile, which means traders can execute the trades efficiently. The U.S., the global hub for the financial market, creates many opportunities for forex traders. Traders worldwide, especially from India, should take advantage of growing their portfolio through this session.