<p id="isPasted">Market spread is highly variable throughout the day, primarily due to fluctuations in trading volume and liquidity. Spreads are generally tightest during peak market hours when activity is highest and widest during off-hours, around major news events, and overnight when participation is low.</p><p><strong>The Role of Liquidity and Volume</strong></p><p>The spread is the difference between the highest price a buyer is willing to pay (the "bid") and the lowest price a seller is willing to accept (the "ask").</p><ul><li>High Liquidity: When many buyers and sellers are active, orders are filled quickly, and the spread narrows (tightens).</li><li>Low Liquidity: When few participants are in the market, it takes longer to match orders, and market makers widen the spread to manage their own risk.</li></ul><p><strong>Spread Variability Per Time of Day</strong></p><p>The trading day can be broken down into key periods with distinct spread characteristics:</p><p> Time Period Trading Volume Typical Spread Behavior</p><table data-animation-nesting="" data-complete="true" data-sae="" style="border: none; border-collapse: collapse; table-layout: auto; width: 652px; color: rgb(230, 232, 240); font-family: "Google Sans", Roboto, Arial, sans-serif; font-size: 14px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; white-space: normal; background-color: rgb(16, 18, 24); text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial;" id="isPasted"><tbody data-complete="true"><tr data-complete="true" data-sfc-cp=""><td colspan="undefined" data-complete="true" data-sfc-cp="" style="border-bottom: 0.8px solid rgb(45, 47, 53); min-width: 4em; vertical-align: top; color: rgb(230, 232, 240); font-family: "Google Sans", Roboto, Arial, sans-serif; font-size: 14px; line-height: 22px; padding: 12px 16px 12px 0px;">Market Open (Early Hours)</td><td colspan="undefined" data-complete="true" data-sfc-cp="" style="border-bottom: 0.8px solid rgb(45, 47, 53); min-width: 4em; vertical-align: top; color: rgb(230, 232, 240); font-family: "Google Sans", Roboto, Arial, sans-serif; font-size: 14px; line-height: 22px; padding: 12px 16px 12px 0px;">High</td><td colspan="undefined" data-complete="true" data-sfc-cp="" style="border-bottom: 0.8px solid rgb(45, 47, 53); min-width: 4em; vertical-align: top; color: rgb(230, 232, 240); font-family: "Google Sans", Roboto, Arial, sans-serif; font-size: 14px; line-height: 22px; padding: 12px 0px;">Spreads can initially widen due to overnight news and a rush of initial orders, then quickly tighten.</td></tr><tr data-complete="true" data-sfc-cp=""><td colspan="undefined" data-complete="true" data-sfc-cp="" style="border-bottom: 0.8px solid rgb(45, 47, 53); min-width: 4em; vertical-align: top; color: rgb(230, 232, 240); font-family: "Google Sans", Roboto, Arial, sans-serif; font-size: 14px; line-height: 22px; padding: 12px 16px 12px 0px;">Peak Hours (Active Sessions Overlap)</td><td colspan="undefined" data-complete="true" data-sfc-cp="" style="border-bottom: 0.8px solid rgb(45, 47, 53); min-width: 4em; vertical-align: top; color: rgb(230, 232, 240); font-family: "Google Sans", Roboto, Arial, sans-serif; font-size: 14px; line-height: 22px; padding: 12px 16px 12px 0px;">Very High</td><td colspan="undefined" data-complete="true" data-sfc-cp="" style="border-bottom: 0.8px solid rgb(45, 47, 53); min-width: 4em; vertical-align: top; color: rgb(230, 232, 240); font-family: "Google Sans", Roboto, Arial, sans-serif; font-size: 14px; line-height: 22px; padding: 12px 0px;">Spreads are typically the tightest and most stable as major financial centers are actively trading (e.g., London and New York sessions overlapping for forex).</td></tr><tr data-complete="true" data-sfc-cp=""><td colspan="undefined" data-complete="true" data-sfc-cp="" style="border-bottom: 0.8px solid rgb(45, 47, 53); min-width: 4em; vertical-align: top; color: rgb(230, 232, 240); font-family: "Google Sans", Roboto, Arial, sans-serif; font-size: 14px; line-height: 22px; padding: 12px 16px 12px 0px;">Mid-Day (Between Sessions)</td><td colspan="undefined" data-complete="true" data-sfc-cp="" style="border-bottom: 0.8px solid rgb(45, 47, 53); min-width: 4em; vertical-align: top; color: rgb(230, 232, 240); font-family: "Google Sans", Roboto, Arial, sans-serif; font-size: 14px; line-height: 22px; padding: 12px 16px 12px 0px;">Moderate to Low</td><td colspan="undefined" data-complete="true" data-sfc-cp="" style="border-bottom: 0.8px solid rgb(45, 47, 53); min-width: 4em; vertical-align: top; color: rgb(230, 232, 240); font-family: "Google Sans", Roboto, Arial, sans-serif; font-size: 14px; line-height: 22px; padding: 12px 0px;">Spreads may slightly widen as one major session closes and before another fully opens, leading to a dip in liquidity.</td></tr><tr data-complete="true" data-sfc-cp=""><td colspan="undefined" data-complete="true" data-sfc-cp="" style="border-bottom: 0.8px solid rgb(45, 47, 53); min-width: 4em; vertical-align: top; color: rgb(230, 232, 240); font-family: "Google Sans", Roboto, Arial, sans-serif; font-size: 14px; line-height: 22px; padding: 12px 16px 12px 0px;">Market Close</td><td colspan="undefined" data-complete="true" data-sfc-cp="" style="border-bottom: 0.8px solid rgb(45, 47, 53); min-width: 4em; vertical-align: top; color: rgb(230, 232, 240); font-family: "Google Sans", Roboto, Arial, sans-serif; font-size: 14px; line-height: 22px; padding: 12px 16px 12px 0px;">High</td><td colspan="undefined" data-complete="true" data-sfc-cp="" style="border-bottom: 0.8px solid rgb(45, 47, 53); min-width: 4em; vertical-align: top; color: rgb(230, 232, 240); font-family: "Google Sans", Roboto, Arial, sans-serif; font-size: 14px; line-height: 22px; padding: 12px 0px;">Volume increases as traders close positions, but volatility can also spike, sometimes widening spreads just before the close.</td></tr><tr data-complete="true" data-sfc-cp=""><td colspan="undefined" data-complete="true" data-sfc-cp="" style="border-bottom: 0.8px solid rgb(45, 47, 53); min-width: 4em; vertical-align: top; color: rgb(230, 232, 240); font-family: "Google Sans", Roboto, Arial, sans-serif; font-size: 14px; line-height: 22px; padding: 12px 16px 12px 0px;">Overnight/Off-Hours</td><td colspan="undefined" data-complete="true" data-sfc-cp="" style="border-bottom: 0.8px solid rgb(45, 47, 53); min-width: 4em; vertical-align: top; color: rgb(230, 232, 240); font-family: "Google Sans", Roboto, Arial, sans-serif; font-size: 14px; line-height: 22px; padding: 12px 16px 12px 0px;">Very Low</td><td colspan="undefined" data-complete="true" data-sfc-cp="" style="border-bottom: 0.8px solid rgb(45, 47, 53); min-width: 4em; vertical-align: top; color: rgb(230, 232, 240); font-family: "Google Sans", Roboto, Arial, sans-serif; font-size: 14px; line-height: 22px; padding: 12px 0px;">Spreads are at their widest due to minimal participation and minimal market makers willing to provide quotes, increasing the cost of trading.</td></tr><tr data-complete="true" data-sfc-cp=""><td colspan="undefined" data-complete="true" data-sfc-cp="" style="border-bottom: none; min-width: 4em; vertical-align: top; color: rgb(230, 232, 240); font-family: "Google Sans", Roboto, Arial, sans-serif; font-size: 14px; line-height: 22px; padding: 12px 16px 12px 0px;">Major News Events</td><td colspan="undefined" data-complete="true" data-sfc-cp="" style="border-bottom: none; min-width: 4em; vertical-align: top; color: rgb(230, 232, 240); font-family: "Google Sans", Roboto, Arial, sans-serif; font-size: 14px; line-height: 22px; padding: 12px 16px 12px 0px;">Highly Volatile</td><td colspan="undefined" data-complete="true" data-sfc-cp="" style="border-bottom: none; min-width: 4em; vertical-align: top; color: rgb(230, 232, 240); font-family: "Google Sans", Roboto, Arial, sans-serif; font-size: 14px; line-height: 22px; padding: 12px 0px;">Spreads can widen dramatically in seconds around high-impact economic news releases (e.g., NFP, Fed interest rate decisions) due to extreme volatility and uncertainty.</td></tr></tbody></table><p><br></p><ul><li id="isPasted">Best Time for Tight Spreads: Trade during the primary market hours when the sessions you are interested in (e.g., the US stock market open or the overlap of the London/New York forex sessions) are most active.</li><li>Worst Time for Wide Spreads: Avoid trading right at market open/close, during overnight sessions, or during major, unscheduled news events (which can cause "gapping").</li></ul>
<p id="isPasted">Market spread is highly variable throughout the day, primarily due to fluctuations in trading volume and liquidity. Spreads are generally tightest during peak market hours when activity is highest and widest during off-hours, around major news events, and overnight when participation is low.</p><p><strong>The Role of Liquidity and Volume</strong></p><p>The spread is the difference between the highest price a buyer is willing to pay (the "bid") and the lowest price a seller is willing to accept (the "ask").</p><ul><li>High Liquidity: When many buyers and sellers are active, orders are filled quickly, and the spread narrows (tightens).</li><li>Low Liquidity: When few …</li></ul>
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