Hello, Norm
You’re confusing:
B[/B] trading session times (daily periods of high-volume activity, normally lasting 8 or 9 hours) with
B[/B] the time at which a broker divides one 24-hour day from the next.
Both (1) and (2) are arbitrarily specified.
Trading goes on 24 hours per day, 5 days per week in all forex markets, including New York, which I will use in the following example, because it’s the market you referred to.
B[/B] Most of the foreign exchange trading transacted in New York occurs between early morning and early evening. Bankers don’t punch a time-clock. Some might arrive at the trading desk before 6 in the morning, and leave the office after 8 in the evening. But, the majority of daily trading volume occurs between 8am and 5pm, a time period which brackets (a) the normal business day in New York, and (b) the session times of the U.S. stock exchanges and commodity exchanges.
[I]So, 8am to 5pm represents an arbitrarily-chosen time period for designating the New York Session,[/I] and this arbitrarily-chosen time period is as good as any. In my studies, I have estimated that about 83% of daily forex trading volume occurs during this 9-hour period, and only 17% of daily volume occurs during the other 15 hours of the 24-hour trading day.
B[/B] Retail forex brokers must decide for themselves where (on the clock) to draw the line between one 24-hour day and the next. Choices might include midnight, local time, to coincide with the ordinary calendar day. Or, midnight GMT, to “internationalize” the designation. Or, 5pm New York time, for reasons which I have explained in many previous posts.
[I]In the forex industry, 5pm New York time is becoming the accepted standard time [/I]at which “Monday” becomes “Tuesday”, and then “Tuesday” become “Wednesday”, and so forth.
Once a broker has chosen this time as the end of one trading day and start of the next trading day, then obviously this time becomes the closing/opening time for daily candles on that broker’s charts.
And, in order to synchronize the lower-time-frame charts with the daily charts, [I]the first candle each trading day[/I] on the H2, H3, H4, H6 and H12 charts must also open at 5pm New York time. The H1 chart, and the minute-charts, are not affected by the choice of time for the start of each trading day; likewise, weekly and monthly charts are not affected.
I hope this clears up the confusion.
Cheers
.