Lesson No 16
Tokyo Session: Tokyo
session starts first, which is also called Asian session. Japan is third economic power of the world,
and Japanese Currency Yen has 16.50% share in forex market and 21% trading of
yes is made during Asian session.
Characteristics of
Tokyo Session: Following
are the salient features of Tokyo Session:
Ø In Tokyo Session (also called Asian
Session), trading is not limited to Japan only, but forex trading shifts in
millions of dollars to Singapore, Sydney, Hong Kong and China which is
connected to Tokyo Session.
Ø In Tokyo Session major partners are
Exporter and Central Banks. Although
economy of China and Japan mainly depends on exports but even then volume of
forex trading remains very low sometimes it looks that market is even closed.
Ø Besides above, even then in Asia Pacific
currency pairs like NZD/USD, AUD/USD a quick movement is quite visible.
Ø Due to limited volume of trades markets
runs on sideways which at the end become the cause of breakout and make
opportunities for trading.
Ø Market move more quickly when central
banks and governments announce economic reforms and policies.
Currency Pairs in
Asian Session: When
there is any political upset or announcement of economic policies in Japan, New
Zeeland, Australia and China then there is fast flow of trading of JPY, AUD,
NZD which is called news trading, but to be very truthful at that time trading
is very dangerous it can even washout your accounts if you don't know good
money management skills, very few traders have the skills to deal with this
type of trading.
London Session: When
Asian traders close their trading at that time London's traders start their
trading. In Europe there are many other
financial departments dealing with financial activities and investments but
most of the traders focus on London market.
Historically, due to its geographical location, London remained an
attraction for the traders. And this is
not an astonishing fact that in London session, in one minute, thousands of
traders take part. Overall 30% of forex
trading occurs during London session.
Salient Features of
London Session: Followings
are some characteristics of London Session:
Ø London session overlaps Tokyo and New
York sessions due to which there is a fast flow of trading in this session of
volume of trades remain very high during London Session.
Ø Most of trends occurs during London
session which remains continue till the start of New York Session.
Ø In the middle of London session flow of
trading decreases, as traders take rest and wait for New York Session.
Ø Sometimes, at the end of London Session,
there are reverse trends as mostly traders lock their profits and close their
trades.
LESSON No 17
What are Trends: Movement
of price in any direction is called "Trend". Price always moves from left to right. There are three possible trends / movements
of price:
ü Upward Trend
ü
Downward Trend
ü
Sideways Trend
Suitable Pairs for
Trading: It
is very important to know that which currency pairs are to be traded during
forex trading. Specially new traders
should know about these currency pairs so that they can earn good profit for
the trades and time.
According to flow and volume of the
market trading of major pairs is very important i.e EUR/USD, AUD/USD, USD/JPY,
GBP/USD, USD/CAD, USD/CHF, NZD/USD, because their spreads (difference between
buying and selling price) remain very low.
You can trade cross currency pairs but their spreads are vey high.\
New York Session: At
about 12PM or 1PM London time New York Session starts.
Characteristics of
New York Session: Following
of salient features of New York Session:
Ø During first few hours of New York
Session market flow remains very high due to overlapping of London Session.
Ø In starting few hours mostly important
news are released those effects the market in any way.
Ø On Friday at noon flow of market
decreases as London and Tokyo markets are already closed.
