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What times does the spread start in forex?

Forex trading has become increasingly popular over the years, and with the rise of technology, it has become accessible to a wider audience. However, one question that often arises is what time does the spread start in forex?

Firstly, it’s essential to understand what the spread is in forex. The spread refers to the difference between the bid price and the ask price of a currency pair. The bid price is the price at which a trader can sell a currency, while the ask price is the price at which a trader can buy it. The spread represents the cost of trading and is essentially the commission charged by the broker.

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The spread can vary depending on several factors, including the liquidity of the market, the volatility of the pair, and the broker’s pricing model. As a general rule, the spread tends to be narrower during the most active trading sessions.

The forex market is open 24 hours a day, five days a week, from Sunday night to Friday night. However, not all trading sessions are equal in terms of activity and liquidity, and the spread can vary depending on the time of day.

The forex market is divided into three major trading sessions – the Asian, European, and North American sessions. Each session has its characteristics, and the spread can vary significantly depending on the time of day.

The Asian session starts at 10 pm GMT on Sunday and ends at 9 am GMT on Monday. This session is generally the quietest, with lower trading volumes and liquidity. Consequently, the spread tends to be wider during this time, as there are fewer traders and less liquidity in the market.

The European session starts at 7 am GMT and ends at 4 pm GMT. This session is the most active and liquid, as it overlaps with the Asian and North American sessions. The spread tends to be narrower during this time, as there are more traders and higher liquidity in the market.

The North American session starts at 12 pm GMT and ends at 9 pm GMT. This session is less active than the European session but more active than the Asian session. The spread can vary during this time, depending on economic news releases and other market events.

It’s also important to note that some pairs are more active during specific trading sessions. For example, the USD/JPY pair tends to be more active during the Asian session, while the EUR/USD pair is more active during the European session.

In conclusion, the spread in forex can vary depending on several factors, including the time of day and trading session. Traders should be aware of the different trading sessions and their characteristics to optimize their trading strategies and minimize their trading costs. It’s essential to choose a broker with competitive spreads and transparent pricing to ensure that you’re getting the best value for your trades.

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