8am is when most of the pre trading for stocks start. Most earnings are released at this time driving the Dow Jones and S&P futures. Plus this is where the Europe sessions comes back from lunch and the New York session starts so there is a lot of the volatility happens so you can be able to set up good trades depends on the economic data that is released. I hope this helps any other question let me know
maybe because NY at 8 a.m. is the basic start of the business day - - some days are lets’ get rockin some days are lets see what things are happenin’ or hey were on vaca.
The spot forex market (the market which we trade) is a decentralized, off-exchange market, which is “open” everywhere in the world 24 hours per day, from 8am Monday morning in New Zealand (1900 GMT Sunday) until 5pm Friday afternoon in New York (2200 GMT Friday). That’s 123 hours per week that the retail spot forex market is “open”. Everywhere.
But, in every one of the principal forex market locations (London, New York, Tokyo, etc.) trading volume is heaviest during the [I]normal business hours[/I] in that location. As a rule of thumb, more than 80% of each day’s volume in each location occurs during normal business hours, and less than 20% of each day’s volume in each location occurs in the overnight period. These volume percentages are based on a 9-hour business day, 8am-5pm, in each location.
Because daily forex trading volume in each market location is so heavily concentrated in the 8am-5pm time period in that location, we refer to that 8am-5pm period as the “trading session” in that market.
There are many threads and posts here on this forum in which session times are discussed, and you can use the SEARCH feature at the top of this page (or any other forum page) to search the forum for everything ever written on that topic.
I was referring to the NYSE when I wrote “before the exchange opens”.
Specifically, I was wondering why people who trade on the spot Forex market, Forex Traders, and BabyPips in particular chose 8 AM EST as the starting time for what is referred to as the “New York Session”.
The start times for this “New York Session” do not match the open and close times for the NYSE which may or may not be relevant but still an interesting observation.
So why choose 8 AM?
Why not some other time as you mentioned the spot Forex market starts at 1900 UTC Sunday.
IF ( 80% of each day’s volume in each location occurs during normal business hours of that location ),
AND specifically for New York, that occurs between 8:00 AM and 5:00 PM EST,
THEN that is a solid reason for choosing those times as the start and end of the “New York Session”.
Thank you very much for that insight. It was the kind of reasoning I was looking for.
staggs0288 said 8:00 AM happens to be 1:00 PM in London when most people are returning from lunch,
which adds one more reason why 8:00 AM makes sense.
There doesn’t seem to be much supporting evidence for any other reasonable start time.
Thanks everyone for your comments. They really helped.
I must agree that 8am is arbitrary and way too early. Most people don’t start work until 9am, and that includes banks and other financial institutions. 9:30am is when you really notice the volumes picking up. Of course there are overlaps between the London and Frankfurt and NY sessions at 8am NY time which is why its still considered a high volume time. But for example 8am London time is not very active (because it doesn’t matter that it is overlapping with the always dead Asian session). I actually never understood why the Asian session is always such a snooze festival? Asia has massive population, plenty of industry, and a lot of wealth, but no one ever seems to trade.
8AM is the start of the NY session. Living in NY timezone most of my life (Florida) though I can say most banks open at 9AM (some at 8) and the opening bell of the NYSE is at 9:30am. However I do believe (and I could be wrong) the NYSE actually opens at 8. Us Americans like our coffee in the morning so things dont get rolling till 9-9:30.
