Forex trading is a global market that operates 24 hours a day. As such, different trading sessions are available throughout the day, each with its own unique characteristics. The London session is one of the most important trading sessions in the forex market. In this article, we will explain what time the London session opens in forex and why it is important for traders.
The London session is also known as the European session. It is the second-largest forex trading session in terms of trading volume after the New York session. The London session opens at 8:00 AM GMT and closes at 4:00 PM GMT. It is also referred to as the “London Fix” as it is the time when major banks in London set the daily foreign exchange rates.
The London session is particularly important because it overlaps with the Asian and American trading sessions. This means that there is a lot of liquidity in the market during this time, which makes it an excellent time for traders to enter and exit trades. The overlap with the Asian session means that traders can take advantage of the increased volatility and liquidity in the market as Asian traders begin to close their positions, and European traders begin to enter the market.
The London session is also important because it is the time when major economic data releases from the European Union are announced. These data releases include GDP, inflation, employment figures, and central bank interest rate decisions. These announcements can have a significant impact on the forex market, and traders need to be aware of them to make informed trading decisions.
Another reason why the London session is crucial is that it is home to the largest financial center in the world, London. London is the financial capital of Europe, and many of the world’s largest banks and financial institutions are based there. As such, the London session is the time when many of these institutions are active in the forex market, which can lead to increased volatility and liquidity.
Additionally, the London session is known for its tight spreads, which means that traders can execute trades at very favorable prices. This is because many of the world’s largest liquidity providers are active during this session, which keeps spreads tight.
In conclusion, the London session is one of the most important trading sessions in the forex market. It opens at 8:00 AM GMT and closes at 4:00 PM GMT. The session is important because it overlaps with the Asian and American trading sessions, has many economic data releases from the European Union, and is home to the largest financial center in the world. The London session is also known for its tight spreads, making it an excellent time for traders to enter and exit trades. As such, traders need to be aware of the opening and closing times of the London session to take advantage of the opportunities it presents.
