it could be like that. earlier i tried 75% of gap as TP and 1:1 for SL, it hit SL most of the times before hitting the TP
problem with gap theory is it says gaps do get filled but it doesnt say when. it could take few weeks in some cases. leaving it withput SL is certainly dangerous.
like most of the strategies that 'look' good on paper but get lost due to improper exits, this is also in same category. without a proper exit strategy idea will remain as idea but not as a tradable system
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Although I hate to use the dirty word 'optimisation', could you not have these functions as optimisable and then backtest ? You could also include 'number of bars' before exiting. But you are right in that a good looking idea doesnt always make a tradeable strategy. And money management is the key to FX.
He was looking for the card so high and wild hed never need to deal another
Although I hate to use the dirty word 'optimisation', could you not have these functions as optimisable and then backtest ? You could also include 'number of bars' before exiting. But you are right in that a good looking idea doesnt always make a tradeable strategy. And money management is the key to FX.
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I'm with you dr who, I'd love to be able to backtest and optimise, but bottom line for me is I just want automated entry, so features are not that necessary. I can manage the trades with MyFX Console.
I'll test the EA posted by roundrock, though not sure how it knows Friday close and Monday open. For me, they are the only gaps of interest
it uses SMA for determining the trend. you dont want any trend indicator set it to false. If userTradingAllowed is false, it doesnt send orders, it just acts like indi
place this EA on any symbol DAILY chart and let it run. it scans all symbols and lists the gaps above min required in the Comment section and places ordrers. it doesnt do exits right now. unless i know exit strategy i cant code.
if you try to backtest, it works for that symbol ONLY. thats a limitation on MT4. You cant backtest multipair strategies...
pl use and let me know any...
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roundrock, so your EA is *not just* for Sunday gap? What is it showing (ie. default) when it indicates certain pairs as candidates, like when I first apply it this London session? (I certainly will let it run and see what happens)...but would you share a bit more on your EA trading non-traditional times during the week? Like where is the gap, and what is it doing choosing those entry places?
roundrock, so your EA is *not just* for Sunday gap? What is it showing (ie. default) when it indicates certain pairs as candidates, like when I first apply it this London session? (I certainly will let it run and see what happens)...but would you share a bit more on your EA trading non-traditional times during the week? Like where is the gap, and what is it doing choosing those entry places?
Regards, and *thanks* for sharing it.
Ron
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you need to put this EA on daily chart. on formation of new bar, it checks for gap between this bar open and prev bar close. if gap is more than the min gap specified it lists them in comments and places orders...
so even if it runs on weekdays it doesnt do anything. you need to keep it running on monday morrning before market opens
Just a word of caution to those who like this idea, since the last trade in the xls file 'Updated Gap Backtest' I reckon for all 4 pairs covered there have been 8 trades up to and including 2nd Jan. 5 have been losers and 3 winners. So take care.....
He was looking for the card so high and wild hed never need to deal another
I do sometimes trade Gold on Sundays. Every time their is a large move right on the open of the futures session (6 PM EST), gold always retraces back to the last close price. I know with Oanda, if EURUSD is down or up alot, you can buy or sell gold right before 6 PM EST at the same weekend prices and make a huge profit on the highly probable move. Then I reverse the position and gold usually goes back to the opening price.
In the following picture. EURUSD was down (Open of 12.26.2010). You would sell gold right before it open at 6 PM EST (you can with oanda). Then after you notice signs of a reversal, you would reverse your position and take profit at last Fridays close. This could lead to some huge profits but make sure to manage your risk.
also, each broker has different opening time for gold. so the gap times will vary.
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Oanda lets you trade virtually 24/7 (yes, you can place trades over the weekend but the spreads are higher and their is no movement).
With that said, EURUSD usually start moving around 2:00 PM on sunday with oanda. So at 5 PM, while most other brokers start trading, you could have been trading with oanda for 3 hours already. But that is besides the point, all you need to know is you can trade 24/7 with oanda.
Now with gold, the official gold market doesn't open until 6 PM on sunday. That means that their is no price movement and with most brokers, you can not trade until 6 PM when the gold market officially opens. However with oanda you can trade before 6 PM. Their are 2 ways you can trade gold.
The first way is more risky. If at 5:45 PM Sunday you see that EURUSD is down more than ~40 pips from fridays close, then you would sell gold right before the Gold market opens (because if EURUSD is down a lot, their is a high probability gold will shoot down.) And you would buy gold if EURUSD is up more than ~40 pips. The reason is that EURUSD show the current value, but since the gold market did not open yet, you would be trading last fridays gold prices. This is the first way, it is a lot more risky but the rewards generally outweight the risk. Make sure to test first.
The second trade you can make is wait for gold to spike up or down. For example in the picture I provided, gold spiked down. Once I saw that it started reversing, I would buy and have my take profit at the original opening price. The reason for this is that whenever gold has a large movement upon open, it always tends to go back to the original opening price.
In short, with the first trade, you are trying to catch the gap using the EURUSD to know if it will go up or down. The second trade is trying to catch the retrace back to the opening price.
A couple of rules. Start trading on sundays. If you are good, you could move on to regular days as well. For the first trade, if their is no major move in EURUSD by the time gold opens, do not trade. And for the second trade, if gold does not spike up or down, do not trade. Their will always be tomorrow.
And you will need to trade on oanda (or any broker that lets you trade 24/7 including the weekends)
Oanda lets you trade virtually 24/7 (yes, you can place trades over the weekend but the spreads are higher and their is no movement).
With that said, EURUSD usually start moving around 2:00 PM on sunday with oanda. So at 5 PM, while most other brokers start trading, you could have been trading with oanda for 3 hours already. But that is besides the point, all you need to know is you can trade 24/7 with oanda.
Now with gold, the official gold market doesn't open until 6 PM on sunday. That means that their is no price movement and with most brokers,...
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If you are good, you could move on to regular days as well. For the first trade, if their is no major move in EURUSD by the time gold opens, do not trade
on regular days, at what time gold market opens ? i thought it doesnt close at all till friday evening.
on sunday 5:45 PM, when you are buying/selling gold how are the spreads ? do you recommend market order or limit order ? if market order how can you control the market spikes at execution time ?
thanks a lot for sharing this. i have oanda, let me observe this weekend
on regular days, at what time gold market opens ? i thought it doesnt close at all till friday evening.
on sunday 5:45 PM, when you are buying/selling gold how are the spreads ? do you recommend market order or limit order ? if market order how can you control the market spikes at execution time ?
thanks a lot for sharing this. i have oanda, let me observe this weekend
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When we talk about gold and the gold market, most people refer to futures because they dominate the market. Gold futures are open Sun 6 PM --> Friday 5:15 PM and are closed everyday from 5:15 PM --> 6:00 PM. That is why their is virtually no movement during the weekends and everyday from 5:15 to 6:00 PM and most brokers suspend gold trading overall. That is also why most brokers don't allow gold trading till 6 PM on sunday and why their is a very large movement on sunday at 6 PM.
As for spreads, with oanda, I have never seen the spread more than $5 (even for temporary spikes). On the weekend up to the open, you could expect a $2.5 spread which, generally speaking, is huge but remember that their is usually a very large movement right after the open (up to $20 one way).
I always use limit order just in case. Spikes shouldn't be a problem with but it is better to be safe then sorry.
The importaint thing is patience. Their are weeks where their is little volitility and no spike at all. It is better to wait and fight another day. And make sure to watch / demo with oanda for atleast 3 months before trying it out. I suggest only trading on sunday but it also works on weekdays sometimes.
it uses SMA for determining the trend. you dont want any trend indicator set it to false. If userTradingAllowed is false, it doesnt send orders, it just acts like indi
place this EA on any symbol DAILY chart and let it run. it scans all symbols and lists the gaps above min required in the Comment section and places ordrers. it doesnt do exits right now. unless i know exit strategy i cant code.
if you try to backtest, it works for that symbol ONLY. thats a limitation on MT4. You cant backtest multipair strategies...
pl use and let me...
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howdy roundrock
Can you tell me how the EA detects a weekend gap specifically, or does it just work off any gap? I really only trade the gaps between Friday close and Monday open.
I don't normally use daily charts for gaps. I prefer to use 5 minute charts. Will that be an issue with this indy?
When we talk about gold and the gold market, most people refer to futures because they dominate the market. Gold futures are open Sun 6 PM --> Friday 5:15 PM and are closed everyday from 5:15 PM --> 6:00 PM. That is why their is virtually no movement during the weekends and everyday from 5:15 to 6:00 PM and most brokers suspend gold trading overall. That is also why most brokers don't allow gold trading till 6 PM on sunday and why their is a very large movement on sunday at 6 PM.
As for spreads, with oanda, I have never seen the spread more than...
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hi
the chart you posted above is that of eu and not gold.
the problem i see with gap trading on gold is this:
during weekdays there are hardly any significant gaps between day close and open. in fact i could not see any weekdays gaps in the last 2 months on gold.
similarly weekend gaps rarely occur. i only came across one gap of 6 pips in december and one gap in january 2011.
problem is, the gap is so small it is hardly worth trading. it can also be the case that the price may not retrace back to cover the gap. although the majority of the times it does , sometimes it doesn't and just keeps on going one way.....which leaves the question of where to put the stop, and concerns on large drawdowns. just for the sake of a few pips.
so iam curious to know how you exactly trade these gaps and some chart examples would help. how many gaps on average do you trade per month on gold ?
today, there was no weekend gap on gold.
when you say 6pm time on oanda, is that 10pm london time ?
the chart you posted above is that of eu and not gold.
the problem i see with gap trading on gold is this:
during weekdays there are hardly any significant gaps between day close and open. in fact i could not see any weekdays gaps in the last 2 months on gold.
similarly weekend gaps rarely occur. i only came across one gap of 6 pips in december and one gap in january 2011.
problem is, the gap is so small it is hardly worth trading. it can also be the case that the price may not retrace back to cover the gap. although the majority of...
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A couple of thing I think that you misunderstand and I will try to explain myself better.
First of all, XAU/USD is the symbol for spot gold in USD. So the chart I provided is the price of gold when it opened on Dec. 26th.
Second of all, I meant this strategy should primerily be traded at the start of the week (on Sunday). I have trade this strategy over the last year and a half and I rarely trade on the weekdays, only when EURUSD make a huge move (you can use other USD pairs to confirm that the value of the USD is changing not the EUR, but this is really unnecesary)
Now let me talk about the opening price of gold. In the chart I provided, Gold initially opened about $6 lower but soon traded as much as $12-$13 lower before it showed a sign of a reversal. Now I am not sure if you traded gold before but $13 on gold is a lot, especially within an hour.
And that is only one way. Remember, you are trading on the original movement and also the retracement. So realistically, you would have made $20 of gold on that day.
As for number of trades a month, it really does depend. Sometimes it is 2 or 3 times and some months I don't trade at all. But when I do, I know that their is a very very high probability that my trade will be favorable and profitable. The thing is, you really only need to be in front of the computer for 2 hours a week (if you only plan on trading sundays, recommended for starters).
Today, I did not trade. EURUSD had made a move but when Gold opened, it was nearly unchanged. And Gold did not make a large move when it opened so their was no retracement trade today either.
You also said that the price sometimes doesn't retraces back to the open, personally I have never seen this on a sunday (I have misses a couple of weeks). I have although seen this on weekdays. I forgot to mention this but you NEVER EVER EVER trade the retracement on weekdays, only on weekends (Sorry, I know this was importaint). For weekdays, you would only trade if their is a HUGE move in EURUSD. But you never trade the retracement on the weekdays, only the original move.
And this leaves us just one question left unanswered. Once you see the signs of a reversal, you place a trade with you take profit just below last fridays close price (a bit below because of the spread) You should place your stop just below the low or above the high gold made. If your stop get hit, that means you will make even more on the retracement so don't be too pissed about it (rarely gets hit). And if your stop is hit 3 times, I would recommend cutting your losses (this never happened and doubt it ever will. Gold would need to drop $50 for this too happen and the chances of that are nearly impossible).
Make sure to use a 15 minute chart to look for reversals. I will post charts later when I find more time. For now, good luck with all you trades.
And I believe 6 PM EST is 11 PM london time. So you would start at 10:45 PM (22:45) london time.
today we got GBPAUD short as per this EA and closed in profit..
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cheers roundrock. A shame. I often find no gaps in my daily charts, but they are certainly there in 1 minute or 5 minute charts.
9am Australian time today as follows:
GBP/AUD Close 1.5614 Open 1.5637 Gap not quite closed yet, currently 1.5631
EUR/USD Close 1.2907 Open 1.2878 My Trade Result +24
USD/JPY Close 83.15 Open 83.24 Didn't take it as under 20 pip gap. Trade went on to fill the gap and continue to 83.06 in 42 minutes.
AUD/USD Close 0.9958 Open 0.9928 Trade Result +26
AUD/CAD Close 0.9919 Open 0.9861 Gap not filled, but I exited at .9896 for a Trade Result +30
EUR/CAD Close 1.2824 Open 1.2790 Trade Result +26
Some spreads kill you a bit with these trades so early, but mine don't hit past 4 or 5. Most are around 2 until trade really gets going and then between 0 - 2
There were more under 20 pips, so left them alone.
Such a shame your EA is for daily charts only. Might have to test it anyway and get inside and tweak it for 5 minute charts
Why wouldn't you want to automate trading these little money spinners? As a supplement to your trading, they are great. It's just a pain to monitor so many and enter at market
A couple of thing I think that you misunderstand and I will try to explain myself better.
First of all, XAU/USD is the symbol for spot gold in USD. So the chart I provided is the price of gold when it opened on Dec. 26th.
Second of all, I meant this strategy should primerily be traded at the start of the week (on Sunday). I have trade this strategy over the last year and a half and I rarely trade on the weekdays, only when EURUSD make a huge move (you can use other USD pairs to confirm that the value of the USD is changing not the EUR, but...
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i see. the question of stop is extremely important. you say if you are trading the retracement up, then the stop should be just below the low. but the low will be about the same point you entered trade ! also not sure what you mean by 3 stops being hit ? that would be a disaster and will take months of weekend gap trading to recover.
i have seen one weekend where the price never retraced but kept on going one way, that one trade itself would have thrown you back a few months. so i think this needs to be given a thought.
cheers roundrock. A shame. I often find no gaps in my daily charts, but they are certainly there in 1 minute or 5 minute charts.
9am Australian time today as follows:
GBP/AUD Close 1.5614 Open 1.5637 Gap not quite closed yet, currently 1.5631
EUR/USD Close 1.2907 Open 1.2878 My Trade Result +24
USD/JPY Close 83.15...
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hi honkin,
what method do you use to trade your gaps ?
some of the pairs you have listed , my brokers weekend spread for those are just huge. around 13 pips ! so not any significant gains to be made there.
