The London session in forex is considered to be one of the most important sessions for trading. It is the second largest financial center in the world, after New York, and is responsible for approximately 36.7% of all forex trading activity. Its location also makes it an important hub for trading between Asia and the Americas.
The London session starts at 3:00 AM EST and ends at 12:00 PM EST. This corresponds to 8:00 AM GMT to 5:00 PM GMT. It is important to note that during the summer months in the United States, the London session will start one hour later due to daylight savings time.
One of the reasons why the London session is so important is because it overlaps with the Asian and New York sessions. This creates a period of high trading activity as investors from all three regions are active in the market. The overlap between the London and New York sessions is particularly important as it accounts for approximately 50% of all forex trading activity.
During the London session, there are a number of important economic releases that can impact the forex market. These include the release of the Bank of England’s interest rate decision, the UK’s GDP figures, and various other economic indicators. Traders will often closely monitor these releases to determine how they may impact the market.
Another important factor to consider during the London session is the volatility of the market. Due to the high trading volume during this session, there can be significant price movements in the market. This can provide opportunities for traders to make profits but also carries a higher level of risk.
In terms of the currency pairs that are most active during the London session, the GBP/USD pair is the most heavily traded. This is due to the fact that both the British pound and the US dollar are major currencies and are widely traded around the world. Other currency pairs that are active during the London session include the EUR/USD, USD/JPY, and USD/CHF pairs.
Overall, the London session is a crucial period for forex traders to be aware of. It is a time of high trading activity and can provide opportunities for traders to make profits. However, it is also important to be aware of the risks associated with this session and to have a solid trading strategy in place in order to manage these risks effectively.
