Sydney open: trading AUD and NZD as majors versus as crosses

[Shadow Trader]

There are two ways to approach the Sydney open, and they lead to different charts.

The first is to treat AUD/USD and NZD/USD as the main event. These pairs get their first real flow when Sydney and Wellington come online, and the first hour often sets a tone, particularly when local data such as employment or a central bank decision is on the calendar. Spreads are usually wider than in London hours, and liquidity is modest, so moves can be sharp but shallow.

The second is to ignore the dollar pairs and watch the crosses, AUD/NZD, AUD/JPY and NZD/JPY. These respond to relative flows between the Australasian economies and to risk sentiment, and they often show cleaner ranges when the US dollar is simply asleep. AUD/NZD in particular can trend quietly on local data differences that barely register against the dollar.

The dollar-pair approach carries more headline exposure. Anything that happened in the US session still echoes there, and a late New York move can continue or reverse as the first Sydney trades print. The cross approach is cleaner on that front, though the spreads can be larger, which matters if targets are small.

Which one suits a scalper depends on target size. When average moves are only a handful of pips, a wide spread on a cross can eat most of the edge. When targets are bigger, the cross ranges become more attractive.

Whatever the choice, the calendar matters here more than in busier hours. A single Australian or New Zealand release can define the whole session.

Which one has worked better for you around the Sydney open, the dollar pairs or the crosses, and what spreads do you see there?