Trading sessions and liquidity: where the cheapest window is
The same pair can cost several times more in one session than another, so choosing your session is itself cost management.
The four main sessions
Forex runs 24 hours, but liquidity is not uniform. In rough Beijing time (each shifts by about an hour when daylight saving changes):
- Sydney: about 05:00–14:00, covering mainly the Australian and New Zealand dollars
- Tokyo: about 08:00–15:00, with yen-related pairs relatively active
- London: about 15:00–24:00, the most concentrated trading of the day
- New York: about 20:00–04:00, when US data are published
London is the most concentrated because it is the world's largest foreign exchange centre. That is the origin of the familiar claim that the major pairs move most fully during London hours.
The London–New York overlap: the best liquidity of the day
Between roughly 20:00 and 24:00 Beijing time, London and New York overlap. Market makers from the world's two largest centres are online simultaneously, quote depth is at its best and spreads are usually at their tightest. For strategies that use tight stops or need precise entries, this is the most favourable window.
Two things must be kept apart: low cost does not mean low risk. The overlap is also the most volatile window, because the major US economic releases land inside it. A narrow spread means good execution conditions, not that price will stay calm.
The cost profile of the Asian session
During Asian hours most European and US market makers are inactive, quote depth falls and spreads are usually wider, with price more likely to oscillate in a narrow band. This session suits lower trading frequency, or entry with limit orders rather than market orders. In mid-October 2026, for example, the dollar index moved noticeably less during Asian hours than during New York hours.
How cost changes around data releases
Major US economic data are mostly published in the New York morning, corresponding to roughly 20:30 to 21:30 Beijing time. At the moment of release market makers pull quotes, spreads can widen several-fold and stop-order slippage rises in step. This is not a platform defect; it is a microstructural feature common to all over-the-counter markets.
Use the economic calendar as a cost calendar: reduce trading frequency in the two hours either side of an event, or switch to limit orders. That does not make you miss the move; it only keeps you out of the worst execution conditions.
Write the session into the trading plan
Fix three items in the plan: the sessions in which you are allowed to trade, the maximum position size for each, and a pause rule for the two hours either side of a data release. Once those are written down, trading frequency falls naturally while the quality of every fill improves.
Lesson summary and self-check
- The London session (roughly 15:00–24:00 Beijing time) is the most concentrated of the day.
- The London–New York overlap (roughly 20:00–24:00) has the best liquidity and tightest spreads, but also the highest volatility.
- Spreads are wider in the Asian session, which suits lower frequency or limit orders.
- US data land around 20:30–21:30 Beijing time and spreads widen noticeably.
Self-check: (1) If your strategy relies on tight stops, which session should you prioritise? (2) Why is "the tightest spread" not the same as "the best time to trade"?