| Updated: October 23, 2025European Trading Session
This lesson will cover the following
- Basic features of trading during the European session
- Advantages and disadvantages
As the Asian session begins to fade, the trading day continues in Europe, through the continent’s largest economic centres. Usually, when we refer to the European session, we mean the London session, as the city accounts for 36.7% of total trading volume, making it the most important economic and commercial centre worldwide – a global capital of Forex trading. Moreover, the trading volume provided by London is much greater than the volume generated by New York and Tokyo combined.
However, London, just like Tokyo during the Asian session, is not the only centre open during the European trading session. Other major centres operating in the region are Frankfurt, Amsterdam and Milan.
Let us now outline some key features of trading during the European session.
The London session begins at 07:00 GMT and lasts until 16:00-17:00 GMT. Between 07:00 and 08:00 GMT the Tokyo session is in its final hour of trading: day traders in Asia are usually exiting the market while their European counterparts are entering. This overlap leads to considerable price movement, especially when compared with the Asian session alone. It is therefore logical to expect that Japanese yen crosses will be highly volatile during this one-hour overlap. Currency pairs such as EUR/JPY and GBP/JPY may exhibit very high activity; however, their bid/ask spreads are likely to remain wide.
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The liquidity during the European session is extremely high because of London’s status as a world financial centre. As a result, almost any currency pair is suitable for trading during European trading hours.
At the end of the European session it also overlaps with the session in New York. Owing to this double overlap (at the beginning and the end of the session), and to the huge liquidity provided by London itself, it is clear why the majority of daily transactions are concentrated during European trading hours. This usually results in the highest liquidity and the narrowest bid/ask spreads of the entire trading day.
As the number of market participants and transactions is at its highest during this session, market volatility increases, and so does the opportunity to benefit from larger price moves. However, this can be a double-edged sword because, along with the opportunities, the risks also rise.
During the European session, substantial blocks of macroeconomic data are usually released from the United Kingdom, Switzerland and the member countries of the Eurozone. These publications can affect several currencies, chiefly the euro, the pound and the Swiss franc. Given this, it is logical to trade major currency pairs such as EUR/USD, GBP/USD, USD/CHF, EUR/GBP and USD/JPY. Another reason to focus on these pairs is that they typically have the lowest bid/ask spreads compared with other currency pairs.
The London trading session is also known for its lunchtime lull. Between 12:00 and 14:00 the market usually quietens as traders and brokers have lunch with their clients. High-volume trading typically resumes at 14:00, ahead of the opening of the New York session.
Next, we shall discuss the specifics of trading during the final segment of the trading day – the American (New York) session.