Where does the money come from in FOREX?

Commander in Pips: Ok, son, now we are shifting to the trading process directly.

Pipruit: Finally, Sir. I really can’t hold myself back anymore and want to make my first trade now.

Commander in Pips: Well, there is still a long way to that moment, son. I’m not saying that “we start to make trades”. I’ve just said that we now turn to trading process education.

When should we trade?

Pipruit: So, as I suspect, we finally, have known all necessary stuff about trading time. May be we should turn to trading directly?

Commander in Pips: Hold your horses, son…

Pipruit: More studying? Noooo!!!

Commander in Pips: Just one final step remains – what about suitability for trading of a particular trading days?

Pipruit: Well, are they might be different?

It’s double time – trading sessions overlapping

Commander in Pips: Maybe you have noted already, we’ve talked about the fact that liquidity increases during crosses of different trading sessions. So, I offer to talk about this. There are two major overlaps here – “Tokyo-London” and “London-New York”. As you will see, the reason for that is not only the liquidity growth.

Pipruit: And what about “New York-Tokyo, so to say, closes the loop?

Commander in Pips: Hm, if you take a look at our trading sessions diagram in the first part of this chapter, then you’ll see that the New York session barely crosses with Tokyo. Even if it does, this overlapping has an absolutely insignificant effect.

New York trading session

Pipruit: When does the New York trading session start?

Commander in Pips: Just after the British lunch…I’m kidding, but in general it starts to pick up steam roughly at this time – 12:00-13:00 GMT, and gradually fades out to 21:00-22:00 GMT. In terms of America’s time scale – this is just a simple day time – 8:00-17:00 EDT/EST

The New York trading session takes second place in overall day trading volume with about 17-18% of overall turnover. The major point of the NY session is that 80-85% of all transactions involve the US Dollar. So this is a solid reason to pay particular attention to major pairs with USD during this session.