Forex Market Hours in the UK
If you are interested in trading Forex in the UK, there are plenty of things to consider. For instance, learning the market hours can play a major role in how successful you become as a Forex trader. However, this information is not presented on its own. Rather, users are expected to take the time to do their research in order to learn more about the most lucrative times to make trades. Either way, generally speaking, Forex is open 24 hours a day, five days a week.
However, the best times to make trades largely depend on the area in which they are occurring. For instance, when it comes to the UK, London is one of its most important markets. In London, trading is open from 3 am to noon. Since London accounts for around 43% of global trading, taking their trading hours into account is essential. Therefore, London plays a major role in setting rates and controlling monetary policies. For this reason, Forex trends tend to originate in London.
When it comes to Forex trading hours, the best trade time occurs during overlaps in trading times between open markets. This is because the overlaps lead to higher price ranges and ultimately, greater opportunities. When dealing with the UK market, some of the best trading times are:
U.S./London (8 a.m. to noon): One of the best times to trade in the UK occurs when the market overlaps with one of the other most prominent markets, the US. One of the biggest overlaps between the two markets occurs between 8 am and noon. During this time, over 70% of all trades take place. This is because the U.S. dollar and the euro (EUR) are the two of the most popular currencies to trade. This makes this one of the opportune times to make these trades.
London/Tokyo (3 a.m. to 4 a.m.): On the other hand, the other best trading time for the UK occurs when the London and Tokyo markets overlap. Although Tokyo is a smaller market than the United States, this one-hour overlap can make for lucrative trades.
Classical Forex Trading Sessions
If you are wondering about classical Forex Trading sessions, here are some visuals to illustrate these classical sessions.
Forex trading sessions
In other words, the best time to make trades largely depends on where you are located. However, it seems that Wednesday is one of the best days to make trades, no matter where you may reside. Other than that, you will need to find out when the major markets overlap.
What is the Best Time to Trade Forex in the UK?
Generally speaking, a vast number of investors believe 8 a.m. to noon is the best trading time to take advantage of the overlap between the New York and London exchanges. This is because these two centres make up over 50% of all Forex trades. On the other hand, on the other side of the world, the best trading times are from 5 p.m. to 6 p.m. This is because this is when most of the trading happens on the Singapore and Sydney exchanges. However, this overlap brings about a much smaller volume than during the London/New York overlap.
Best time to day to trade forex
Best Time for Forex Day Trading in UK
In terms of the most relevant time for active trading with good liquidity, here is some information to consider. Generally speaking, the time in which the Forex market is the most active in the UK is just after 8 am, once the London market has opened up. During this time, both liquidity and volatility are at a high since more traders begin interacting with one another during these times. Either way, trading usually becomes less liquid around 10 am, and it once again picks up around 12 pm, after the American market opens up. Liquidity is up whenever customers are engaging with one another.
Best Forex Pairs to Trade in UK Trading Sessions
In other words, it appears that one of the most prominent pairs in most markets, EUR/USD, is one of the most popular pairs in this situation as well. This is followed by other prominent pairs, USD/JPY and GBP/USD. For most traders, it will be a good idea to trade the most liquid currency pairs.
Trading volumes by currency pairs
Time to Pause Forex Trading in UK
As mentioned, the Forex trading liquidity tends to dip around 10 am before rebounding at 12 pm when the US market opens.
Rules and Regulation
Licensing in the UK
Brokerage activity in the United Kingdom is licensed and regulated by the FCA. The country's main public legal institution imposes strict requirements on applicants:
- registration with Companies House
- payment of membership fees to a British bank
- maintaining an office within the jurisdiction
- preparing a document package to substantiate licensing objectives and compliance with all regulatory requirements
Investor protection in the UK
Investors in the UK are protected by the Financial Services Compensation Scheme (FSCS). The FSCS’ purpose is to pay traders compensation (up to £85,000 per client) in case a financial company goes bankrupt or is liquidated.
Taxation in the UK
If a trader’s profits are £50,000 or more, he must pay a 20% income tax. Profits under £50,000 are tax-free.
Best Forex Brokers in UK
If you are wondering about the best Forex traders in the UK, you have lots of options. Here are two of the most highly rated platforms:
eToro
If you are looking for a high-quality Forex broker in the UK, eToro is a great option. This is because the platform offers low fees and commission rates, free insurance of up to $1M dollars, ready-made investment portfolios, and more.
When it comes to spreads, eToro’s most common spreads are USD/EUR and USD/JPY, to a low of 1 PIP. As far as FCA regulations are concerned, the company registration no. is 7973792. It is authorised and regulated by the Financial Conduct Authority (FCA) under firm reference number 583263.
In terms of broker reliability, eToro serves as an agency broker or market-marker. These funds and accounts are kept secure via tier 1 banks. The platform acts as a counterparty to trades. Users are in total control of their overall account settings and receive support as needed.
Admirals Market
On the other hand, Admirals Market also offers an array of benefits. This is largely because it offers lower Forex CFD fees, fast & free deposits and withdrawals, a simple account opening process, free demos, negative balance protection, and much more.
Some of the most common spreads on Admirals Market are EUR/USD, GBP/USD, USD/JPY, and USD/CAD.
When it comes to the Financial Conduct Authority (FCA) is authorised and regulated by the Financial Conduct Authority (FCA), FRN: 595450. Additionally, Admiral Markets UK Ltd is a sister company of Admiral Markets, which adds to its reputation and security. It is also authorised to hold Client Money under the FCA CASS rules.
Given that such reputable authorities regulate Admirals Market, it is considered extremely safe and reliable. Therefore, customers need not worry about the platform’s reliability. With the help of various safeguards, the platform can protect its clients' funds while providing them with a safe, trustworthy platform to interact with and make trades.
FAQs
When is Forex open for trading in the UK?
If you are interested in trading Forex in the UK, you can trade forex 24 hours a day, five days a week online. However, each market has its own unique trading hours and restrictions clients must comply with.
Do you have to pay data exchange fees for Forex trading?
If you are wondering about data exchange fees, most platforms charge little to no fees on forex trades. However, the platform may receive some of its income from the spread or the difference between the bid and ask. Moreover, some users may be subjected to a rollover charge for holding their positions overnight.
How much money is required to place a Forex Trade?
Forex platforms often offer a margin Pip Calculator that allows clients to review the amount of funds needed to conduct a Forex trade. This calculator includes the option to change the contract size as a way to determine how much money is required for trades of different amounts. These platforms may also have a built-in Margin Calculator.
What types of financial products can you trade via Forex platforms?
On most Forex platforms, you can trade cryptocurrencies, precious metals, indices, and commodities.
Team that worked on the article
Oleg Tkachenko is an economic analyst and risk manager having more than 14 years of experience in working with systemically important banks, investment companies, and analytical platforms. He has been a Traders Union analyst since 2018. His primary specialties are analysis and prediction of price tendencies in the Forex, stock, commodity, and cryptocurrency markets, as well as the development of trading strategies and individual risk management systems. He also analyzes nonstandard investing markets and studies trading psychology.
Dr. BJ Johnson is a PhD in English Language and an editor with over 15 years of experience. He earned his degree in English Language in the U.S and the UK. In 2020, Dr. Johnson joined the Traders Union team. Since then, he has created over 100 exclusive articles and edited over 300 articles of other authors.
Mirjan Hipolito is a journalist and news editor at Traders Union. She is an expert crypto writer with five years of experience in the financial markets. Her specialties are daily market news, price predictions, and Initial Coin Offerings (ICO).