Most Volatile Pairs during Asian Session
April 20, 2006 by Trader Rich
Before I dive into this post, let me tell you that from everything I've read and watched from Rob Booker (and from everything he has directly told me) it doesn't seem like the Asian session exists to him. Now he hasn't told me this exactly but he seems to concentrate his effort on the NY Session from 7 am EST - 11 am EST. I told you earlier today that when he was working full-time, he was trading the European session and he did tell me yesterday that you will get a lot of trade opportunities from 4 am EST. So from the information I've gathered, I'd have to say he recommends trading during the hours of 2 am and 11 am EST.
What about the Asian session? For those of you that work in the United States or Canada or anywhere close to the Eastern Time Zone, the Asian session gives us a chance to actually trade when we get home from work without having to get up in the early morning hours with 1/2 a nights sleep to trade the European session.
I will ask Rob if he recommends trading the Asian session or if any of his student have success doing so.
What I wanted to do in this post was to mention the most historically volatile pairs during the Asian Session thanks to Kathy Lien from FXCM. Kathy did a good amount of research on this subject and I thank her for the information though I have asked for absolutely no permission to use it. These PIP ranges are for the time period between 7 p.m. - 4 a.m. EST
| Currency Pairs | PIP Range |
| GBP/JPY | 112 |
| GBP/CHF | 96 |
| USD/JPY | 78 |
| USD/CHF | 68 |
| GBP/USD | 65 |
| AUD/JPY | 55 |
| EUR/CHF | 53 |
| EUR/USD | 51 |
| USD/CAD | 47 |
| NZD/USD | 42 |
| AUD/USD | 38 |
| EUR/GBP | 25 |
As you can see from the chart above, the best options for risk-tolerant traders during this time period are the GBP/JPY, GBP/CHF, and USD/JPY.
For risk-averse traders, AUD/JPY, GBP/USD, and USD/CHF provide more moderate volatility.
The only problem I see with the risk-tolerant pairs, at least 2 of them is the spread. The GBP/JPY spread at FXCM is 9 pips, the GBP/CHF 15 pips! The USD/JPY offers the lowest spread on FXCM at 4 pips.
The risk-averse pairs are a bit better spread wise with AUD/JPY at 8 pips, GBP/USD at 5 pips, and the USD/CHF also at 5 pips.
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I agree the the Asian session is most convenient for people in the Eastern Time zone.
Kathy Lien also goes on to say that London has a 30% market share with the most active session being the European/US overlap (8am-noon) comprising 70 & 80% respectively of the average trading range.
So that is probably why Rob suggest the 2am - 11am trading window.
Personally, from a spread/pip range perspective I think the best pairs to focus on are the GBP/USD, and USD/JPY
-Ali
in my view, when european and US session overlap, the market moves would be predictable. This is around 8-12 EST. this is the time where i am succesfully trade gbp/dollar