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Forex Volatility Cheat Sheet

Master market volatility with this comprehensive guide to currency pair movements, trading sessions, and volatility indicators

Quick Tip: High volatility = Higher profit potential but greater risk. Low volatility = Smaller moves but more predictable patterns.

Currency Pair Volatility Rankings

Average daily pip ranges based on historical data

High Volatility

80-150+ pips/day

  • GBP/JPY ~140 pips
  • GBP/USD ~120 pips
  • EUR/JPY ~110 pips
  • USD/JPY ~100 pips
  • AUD/JPY ~95 pips

Medium Volatility

50-80 pips/day

  • EUR/USD ~75 pips
  • AUD/USD ~70 pips
  • USD/CAD ~65 pips
  • NZD/USD ~60 pips
  • EUR/GBP ~55 pips

Low Volatility

30-50 pips/day

  • EUR/CHF ~45 pips
  • USD/CHF ~40 pips
  • AUD/NZD ~35 pips
  • EUR/CAD ~35 pips
  • GBP/CHF ~30 pips

Trading Sessions & Volatility

Session Time (UTC) Major Pairs Volatility Level Best For
Sydney 21:00 - 06:00 AUD/USD, NZD/USD Low-Medium Range trading, Asian pairs
Tokyo 00:00 - 09:00 USD/JPY, EUR/JPY, GBP/JPY Medium JPY pairs, trend following
London 08:00 - 17:00 EUR/USD, GBP/USD, EUR/GBP High Breakouts, major moves
New York 13:00 - 22:00 USD/CAD, EUR/USD, GBP/USD High News trading, reversals
London/NY Overlap 13:00 - 17:00 EUR/USD, GBP/USD Highest Prime trading time

Key Volatility Indicators

ATR

Average True Range

Measures average price movement over a specific period

High: ATR > 100 pips

Medium: ATR 50-100 pips

Low: ATR < 50 pips

BB

Bollinger Bands

Shows volatility through band width expansion/contraction

Expanding: Increasing volatility

Contracting: Decreasing volatility

Squeeze: Breakout imminent

VIX

Volatility Index

Market fear gauge affecting currency correlations

High VIX: Risk-off, USD/JPY/CHF strength

Low VIX: Risk-on, commodity currencies up

RSI

RSI Volatility

Rapid RSI movements indicate high volatility periods

Fast moves: High volatility

Steady levels: Low volatility

Extreme levels: Reversal potential

ST

Stochastic

Quick oscillations suggest increased market volatility

Rapid swings: High volatility

Smooth moves: Trending market

Flat lines: Low volatility

MA

Moving Average Distance

Distance between fast and slow MAs indicates volatility

Wide spread: High volatility trend

Converging: Decreasing volatility

Crossing: Potential reversal

News Events & Volatility Impact

High Impact Events

NFP (Non-Farm Payrolls) 150-300 pips
FOMC Rate Decision 200-400 pips
ECB Rate Decision 150-250 pips
GDP Releases 100-200 pips
CPI Inflation Data 80-150 pips

Medium Impact Events

Retail Sales 50-100 pips
PMI Data 40-80 pips
Unemployment Rate 30-70 pips
Trade Balance 25-60 pips
Consumer Confidence 20-50 pips

Volatility Trading Tips

1

Pre-News Setup

Reduce position size 30 minutes before high-impact news

2

Wider Stops

Use 1.5-2x normal stop loss during high volatility periods

3

Volume Analysis

High volume + high volatility = stronger moves

4

Risk Management

Never risk more than 2% per trade during volatile periods

Quick Volatility Reference

Best Times to Trade

  • • London Open (8:00-12:00 UTC)
  • • NY Open (13:00-17:00 UTC)
  • • London/NY Overlap
  • • Major news releases

Avoid Trading When

  • • Major holidays
  • • Friday after 15:00 UTC
  • • Thin liquidity periods (e.g., Asian session for non-JPY pairs)
  • • Unscheduled geopolitical events

Risk Management Tips

  • • Use stop-loss orders consistently
  • • Monitor ATR for stop placement
  • • Avoid over-leveraging during news
  • • Diversify across currency pairs