A Tuesday in the life of a spread

[Fairman]

A Tuesday in the life of a spread

Picture EURUSD on an ordinary Tuesday, followed from the platform's point of view.

At 00:00 GMT the spread sits near 0.9, wide by the daily standard because only Sydney and a few early Tokyo desks are active. By 01:00 it eases to 0.6. Tokyo's open helps, but not by much, since EURUSD is not the local favourite.

Around 07:00, as London comes in, it falls to 0.3 and stays there. A little wobble appears at 08:00 when the European banks reshuffle their quotes. Then comes the tight stretch, 08:30 to 11:30, when the pair is as cheap as it gets.

At 11:30 the lunch lull starts. The spread creeps up to 0.5. At 13:30 a data release throws it to 4.0 for three seconds, then 1.2 for a minute, and back to 0.4 by 13:35.

New York carries on with the pair at 0.3 to 0.4 until about 16:30. As London leaves, the spread widens to 0.6. By 20:00 it sits near 0.8. In the last hour before rollover it ratchets up to 1.5, then 3.0 at 17:00 New York time, a spike that lasts several minutes.

A scalper who treats the day as one block ignores the fact that the same trade costs three times as much at some hours as at others. The strategy might be profitable in the tight hours and slightly negative in the rest.

Making a chart of the spread by hour for each pair traded is a ten-minute job with a free script. The result becomes a map of when trading is cheap.

Some people print it and keep it next to the screen. The map saves more money than any new indicator.

When does the spread on the main pair traded actually bottom out, and is it where the habit of trading says it should be?

[Fairman]

Tuesday is often considered one of the more balanced days of the trading week. Monday can be affected by weekend news and a slow start, while Friday brings position squaring ahead of the weekend and major US data on the first Friday of the month. Tuesday usually has normal liquidity and a moderate calendar, with releases such as UK labour data, German sentiment surveys or US consumer confidence on some weeks. The RBA historically met on Tuesdays, which made Tuesday mornings important for AUD pairs, though its schedule changed in 2024. For many scalpers, Tuesday sessions feel routine, which can be an advantage for following a plan without unusual distractions or extreme conditions.