ForexSpirit

The reasons for picking the hours I did to trade the Bunny method were mainly just the result of experience and deduction.

London and New York are the two main locations and time zones in which currencies are traded therefore it seems logical to posit that the greatest amount of trading activity occurs on their watch and especially during the market hours that overlap those two sessions.

The Sydney session has much smaller trading volume and thus when only the Sydney market is open you would expect there to be smaller volume and trading ranges.

The proof is in the pudding and that requires some number crunching.

It is therefore quite handy that someone else has thoughtfully done all the grunt work and made a subset of their findings available for free on the web. The information comes courtesy of Raghee Horner’s FXPowerStat service.

The chart shows the hourly pip range on EUR/USD using data from the past six months. The Hour of Day axis is in Eastern Standard Time.

The main data point in each bar to focus on is the dark green segment as this denotes the average pip range for that bar. The lighter green sections show the ‘area of high probability’, which I’m going to assume highlights the 2 standard deviations range.

The 8:00 to 12:00 EST bars have the highest averages which corresponds to the London and New York sessions overlap, confirming our ‘common sense’ hypothesis.

The choice of trading the 14:00 EST bar is also backed up here, as the average for this bar is the highest one of the whole NY session afternoon period, while also having a wide range.

The start of the Tokyo session at 19:00/20:00 EST (depending if DST is active or not) is shown to result in an uptick in activity.

The one bar I can’t really fathom is the 23:00 EST bar, both its high average (especially being well above the Tokyo session open) and its wide range, going from essentially zero to over 100+ pips.

Does anyone know why it might have these characteristics?