Volatility of GBP USD

[CHRISTO9HER]

Hi guys,

I am a newbie and have been trading a demo account on MT4. I have a question. Does the volatility of the GBP USD vary according to what time of day it is? I know about the overlapping time zones etc. but does this cause any patterns in the volatility of the rate?

I am trading at night (UK) because I have to study all day, and it seems to get real quiet after 10pm. Is this just because the trading in NY dies down at this time?

Could anyone give me a quick rundown of how the volatility changes according to UK time and when the best time to trade it is?

Thanks guys

C

 

[Rhody Trader]

I am a newbie and have been trading a demo account on MT4. I have a question. Does the volatility of the GBP USD vary according to what time of day it is? I know about the overlapping time zones etc. but does this cause any patterns in the volatility of the rate?

I am trading at night (UK) because I have to study all day, and it seems to get real quiet after 10pm. Is this just because the trading in NY dies down at this time?

Could anyone give me a quick rundown of how the volatility changes according to UK time and when the best time to trade it is?

Your observation is right on. As the NY session moves toward its conclusion the action tends to slow down, though certainly that doesn't always mean little movement. There is generally a bit of a gap between the NY wrap up and the really pick-up of Asian trading.

The big action period of the day is the London/NY overlap, which is about noon to 5pm UK.

 

[mp6140]

MP -- just have a good watch that reads EVERY timezone !

Your observation is right on. As the NY session moves toward its conclusion the action tends to slow down, though certainly that doesn't always mean little movement. There is generally a bit of a gap between the NY wrap up and the really pick-up of Asian trading.

The big action period of the day is the London/NY overlap, which is about noon to 5pm UK.

=========================================================

the MOST volitile and satisfying is the London open trading with Asia, followed by the NY open and the overlap trading there. By noon, EDT the London market is closed and NORMALLY the market direction now reverses till 5PM EDT or the "rollover".

from 5 PM EDT, the market reverses direction again, allowing the brokers and mm's to regain shares lost by either (1) selling into the previous rally and now going short, OR (2) covering their shorts and picking up cheap shares as the market sells off from the previous rally intraday (just depends on which direction it was moving originally !)

There is a little action at the Japan open, but they go to breakfast for an hour and things dont really get fun till 10:30 PM, EDT where they move the price in one direction (usually opposite to what it was when the mkt opened and then REVERSE THE MARKET at MIDNITE, EDT which now runs into the open of the NY market, and it starts all over again !

While this is the "normal" scenerio, the FIRST DAY of any stong momentum move, be it up or down, will only give token acknowledgement to these times, as you will see in GBPUSD the last few days of news, where it essentially ONLY moved in one direction each day, but then what goes up MUST come down, so watch !

TIME OF DAY is VERY important !

enjoy and trade well

mp

 

[CHRISTO9HER]

Thanks guys, this has been very useful, some really good insights.

C

 

[balabinba]

377 pips GBPUSD cable Hi-Lo

I'm doing some research on the Cable's volatility. Today is a special day cuz' the cable 4-hour H4 marks the biggest Hi-Lo range since 2004 according to the data that I have. As a matter of fact, the top 5 Hi-Lo range of H4 since 2004 is from the last couple of days.

This is truly exceptional since there doesn't seem to be any news moving the market. It seems to be just some breakout of down trend trendlines.

The H4 starts to move at 16:00 GMT.

 

[tqtran]

I am trading at night (UK) because I have to study all day, and it seems to get real quiet after 10pm.

If you(are in the US) want to trade at night and not during the day during the London session, then 2AM-4AM is the start of your wave.
As already stated, you would really want the London/NY overlap session.

 

[tqtran]

There is a little action at the Japan open, but they go to breakfast for an hour and things dont really get fun till 10:30 PM,

Not entirely true. Asian open is active during "Low Liquidity" periods.