gaps. Where to set the stop loss isn't as clear and will take some testing and experimentation. Previous article: Automated Forex Trading next article: Currency Pairs Trading : Supply, Demand and Resistance The following two tabs change content below. 30 Comments, hey Guys, This Sunday EUR/USD opened.3011, 71 pips below last weeks close.3082. Then when price returned downwards, that area on the chart was filled quickly.
Over the past few years people have started trading Sunday evening gaps in Forex. Forex, gap, strategy is an interesting trading system that utilizes one of the most disturbing phenomena of the. But make sure if youre going to trade in this way, that you take the time to do a little research on your market of choice and select your gap trades based on context and systems forex trading activity. So just like a Real Gap, this gap also has the tendency to get filled. So if you strategy is only gap trading, there will be weeks where you will not get gaps and there will be weeks where you will get gaps that you can trade. Traders want to capitalize on the events and suddenly move the market in one direction.
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If you currently trade gaps, what is your best strategy? When a new week starts look if there is a gap. Then just because a gap is likely to be closed in the session doesnt mean youll know when its going to close. Anything less would be considered irreverent If you see that Mondays candlestick open is below the Fridays close then the forex gap is negative and you should open a Long position at market price. Gap, fill, the most common way to trade a gap is to assume that it will get filled at some point. But there is definitely a sweet spot. If you see Mondays open is above the Fridays close the forex gap is positive and you should open a Short position at market price. Read The Railway Tracks Chart Pattern Forex Trading Strategy-Another Simple Price Action Forex Strategy Heres and example of forex gap trading and how many pips made when the forex gap was filled: The forex gap trading strategy is an very simple and interesting price action. Therefore when you open your trading charts on Monday, you can see a gap. One of the trades had a -306 pips floating loss and the one that is currently has had -101 pips. This may sound illogical but there are some logical reasons for price to fill gaps in the stock market.
Gap trading forex