Spread on FX pairs

⚖ Active trading
1

I had a sell order on EURGBP pair last night.
Around midnight mi order was closed above the daily peak 0.88821, closing price was 0.88929
I looked at the chart and price wasn’t even close to that, it was around 0.88550
Anyway I went to bed and this morning tried to figure out what happened.
Turns out at midnight the spread becomes huge for about an hour and then it goes back down.
I compared the buy chart and the sell chart and it is clearly visible, refer to the attached screenshots

buy price
buy price875×697 46 KB

sell price
sell price883×588 38.8 KB

Can someone please explain to me why is this happening?

2

Welcome to the community, RossF.

When it comes to currency pairs, the most significant liquidity drop in the FX market occurs towards the FX sessions shift. It’s not unlikely to see price spikes during that period since the raw spread itself is usually wide.

In your case, it was at the end of the US FX session and the start of the Sydney one. Up until the beginning of the Asian FX session (1h later), it’s normal to see wider spreads and thinner liquidity.

1 Like