What the London session is
The London session refers to the period of the forex trading day when European banks, institutions and traders are most active. Because London is a global financial hub, a large share of daily FX turnover occurs while European markets are open. That concentration of activity tends to produce higher liquidity and often larger price moves than you see during the quieter Asian or Sydney hours.
In practical terms you’ll hear traders describe the London session by a rough time window expressed in GMT/UTC: roughly 08:00–17:00 GMT. Those hours are a useful reference, but exact broker session markers and the effect of daylight saving mean the local clock times you see on your platform can shift by an hour at certain times of the year.
Why the London session matters
The London session matters because volume and participation are high. Large banks, hedge funds, and corporate flows concentrated in Europe create tight bid-ask spreads and deep order books. That combination makes it easier to enter and exit positions close to the displayed price and it also makes directional moves more reliable when momentum builds.
London is also where many daily trends start. When the European trading day begins, markets absorb overnight Asian moves and then react to European data, central bank commentary, and position adjustments from institutional desks. If the London session carries a clear bias, that bias often persists into the New York session and can define the trading day.
Session overlaps and why they’re important
One reason the London window is so active is that it overlaps other sessions. There is a short overlap with the Tokyo session in the early London hour (around 08:00–09:00 GMT) and a longer, more powerful overlap with New York later in the day (roughly 13:00–17:00 GMT). These overlaps bring participants from two regions into the market at the same time, boosting liquidity and volatility.
The London–New York overlap is particularly important for traders because it is where most of the major pairs — EUR/USD, GBP/USD, and USD/JPY — see their largest moves and tightest spreads. If you trade those majors, the overlap is where many of the best intraday opportunities appear.
Typical price behaviour during the London session
Price behavior during London tends to show three phases. The first hour after the session “starts” often produces a volatility spike as overnight positions are adjusted and European data releases land. Mid-session often calms as traders digest the morning and many desks step back for lunch. The final phase, when New York opens and the overlap begins, frequently brings renewed momentum and larger directional moves. That shape — an early burst, a quieter middle, then a strong overlap — is what many intraday strategies try to exploit.
For example, EUR/GBP might jump on UK inflation data in the session open, then drift sideways at lunch, and pick a new direction once the US market joins and USD-related flows accelerate.
What pairs are most active
Pairs with European currencies and the USD are especially active in London. EUR/USD and GBP/USD tend to have the tightest spreads and the most reliable intraday moves. Crosses involving the pound and euro (EUR/GBP, EUR/CHF) and the yen crosses (EUR/JPY, GBP/JPY) also see meaningful activity because European and Asian flows both touch those pairs at different times.
Concrete examples of how traders use the session
Traders use the London session in different ways depending on their style. Here are two concrete examples woven into a narrative.
A day trader who likes breakouts watches the high and low formed during the Tokyo (Asian) session. As London opens, they place an entry a few pips above the Asian high for a long, with a stop just below the Asian low. If price quickly clears the Asian range and volume picks up, the trader rides the breakout into the London open and may trail the stop as the New York overlap approaches. If the breakout fails, the predefined stop limits the loss. This approach works because the London open often gives the momentum needed to sustain a breakout from the quieter Asian range.
A scalper targets EUR/USD during the London–New York overlap. With spreads narrow and liquidity deep, they take multiple small trades using very tight stops and targets (for example, 5–10 pips). Because execution is cleaner in this window, repeated small wins can add up without the slippage and wider spreads that often occur in low‑liquidity sessions.
Common strategies suited to the London session
The London session is suitable for a range of intraday strategies because of its liquidity and volatility. Breakout trading, momentum and trend-following, and scalping are common approaches. Traders who focus on news often schedule trades around releases from the UK, Eurozone and, later in the day, the US. Range or mean‑reversion techniques can also work in the calmer mid‑session hours, provided risk is managed.
A practical rule of thumb some traders use: match your strategy to the expected session behaviour. If you want fast, bigger moves, prioritise the London open and the London–New York overlap. If you prefer steadier action, trade the middle hours or another session with lower volatility.
Daylight saving and session timing
Daylight saving time changes in the UK, US and other countries shift the local clock times that correspond to the London session. Because of that, many traders talk in GMT/UTC to avoid confusion. Check your broker’s platform clock and an economic calendar during DST transitions — the nominal GMT window stays the same, but what that reads on your local clock will change. Small timing errors can matter when you are trading the open or a scheduled release.
Practical checklist before trading the London session
Before you trade in the London session, it helps to do a short checklist: confirm the session times on your chart platform, scan the economic calendar for scheduled UK/Eurozone and US releases, note any public holidays in Europe (which can thin liquidity), and set clear risk limits for each trade. A short pre-market routine like this reduces the chance of being surprised by a spread spike or a sudden news move.
Risks and caveats
Trading during the London session carries advantages, but it also brings risks. Higher volatility means larger potential losses as well as gains. News releases from the UK, euro area and later the US can cause sharp, one‑direction moves and widened spreads; stop orders may execute at worse prices during those spikes (slippage). Liquidity is usually good in London, but it can evaporate on European bank holidays, widening spreads and increasing the chance of erratic price behaviour. Weekend gaps are another hazard: positions held overnight into the Sunday open can begin at a materially different level than the Friday close. Also remember that while historical patterns (like the London open spike or the overlap surge) are helpful, markets don’t follow rules perfectly — unexpected geopolitical events or central bank statements can change behaviour without warning. Trading carries risk and is not suitable for everyone. This article is educational, not personalised advice. Always size positions and set stops according to your risk management rules.
How to practise the London session safely
If you’re new to trading this session, start in a demo account to observe how your chosen pairs behave during the London open and the overlap with New York. Test one strategy at a time, keep position sizes small, and treat the first few weeks as learning rather than profit-seeking. Track your trades and the conditions around them — time of day, news, spread, slippage — so you can see which setups worked and which didn’t.
Key takeaways
- The London session (roughly 08:00–17:00 GMT) is a high‑liquidity, high‑activity period that often sets the daily trend and contains powerful overlap windows with Tokyo and New York.
- EUR‑ and GBP‑based majors (EUR/USD, GBP/USD, EUR/GBP) and yen crosses are especially active; spreads tend to be tighter, and execution better, during this session.
- Common strategies include breakout trades at the London open, scalping during the London–New York overlap, and trend-following when momentum builds; always back test and demo before trading with real funds.
- Trading carries risk: expect volatility, possible slippage around news and holidays, and time‑zone shifts from daylight saving. This information is educational and not personalised trading advice.
References
- https://marketmates.com/learn/forex/london-session-forex-trading-hours/
- https://www.axiory.com/en/trading-resources/basics/forex-market-trading-sessions
- https://www.myfxbook.com/market-hours
- https://www.babypips.com/learn/forex/london-session
- https://www.avatrade.com/education/trading-for-beginners/forex-trading-sessions
- https://maverickcurrencies.com/london-session/
- https://www.oanda.com/us-en/trade-tap-blog/trading-knowledge/when-is-the-best-time-for-forex-trading/