Forex - Trading the American or US Session
If you haven’t checked out my previous articles on trading the Asian session or the European (London) session, feel free to read them first but it doesn’t quite matter in which order you take a look.
As mentioned before (if you’ve read my Asian / European articles), you’ll know that there are primarily 3 trading sessions in any typical currency trading day and that they are the Asian session, European session and the U.S session (in chronological order).
Of these, the range and trading volume of the Asian session will tend to be the mildest.
Coming back to U.S session, by the time it gets underway, it overlaps the U.K (or European session) for a couple of hours. That’s when there’s lots and lots of liquidity (or big money trading hands if you would).
U.S sessions typically start with news releases such as the U.S home sales, trade balances (or deficit rather), CPI, PPI and so on and so forth. Of these, the most major news release will occur on the 1st friday of each month. This news release is called the nonfarm payroll or the NFP. The moment the number gets released, the market typically moves at least 50 pips within the first 5 mins.
It’s quite a show actually.
The U.S session then tends to get a bit quieter towards the lunch hour that’s around 12pm EST (or DST). It will tend pick up again after lunch only to fizzle out during the last 1-2 hours of trading or banking times. By the time the U.S session ends, it won’t be another 2 hours before the Asian session gets underway again.
