GMT (Greenwich Mean Time)

What is Greenwich Mean Time (GMT)?

Greenwich Mean Time (GMT) is the time measured at the Prime Meridian (0° longitude) in Greenwich, London. It is considered a global reference point for timekeeping and was historically the international standard before Coordinated Universal Time (UTC) became more widely used.

In trading, GMT is important because different financial markets operate across different time zones. Many brokers and charting platforms use GMT to standardize chart timings, ensuring traders can interpret market activity without confusion.

For example:

• The London (European) session begins around 7:00 GMT.
• The New York (American) session begins around 13:00 GMT.

This allows traders to plan strategies around global sessions and market overlaps with accuracy.

Why is GMT Important?

• Consistency: Provides a universal reference that avoids time zone confusion.
• Session Planning: Helps traders align with London, New York, and Asian sessions.
• Market Overlaps: Identifies high-volume periods, such as when London and New York sessions overlap.

GMT Offsets

GMT is used as a base time. Local times are expressed as differences (offsets) from GMT, for example:

• New York = GMT –5 (GMT–4 during daylight savings).
• Tokyo = GMT +9.
• London = GMT +0. (GMT +1 during daylight saving time)

This makes GMT a fixed point of reference for coordinating global trading activities.