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Trade the Gaps... oh You Idiots

  • #1
  • First Post: May 14, 2012 3:57am May 14, 2012 3:57am
This thread is for our Gappies... traders who trade gaps in the markets, usually Monday mornings.

Gappies are a deicated bunch who insist on this crazy illogical method of trading.

I must say I don't trade gaps, and based on the last few weeks I'm glad I don't.

Don't be shy, post you thoughts on Gap trading, how you decide on stops (if you use them) which pairs are more suited to trading gaps etc

You can even call me an idiot and I won't be offended.
In the days of old when sailors were bold, and seldom if ever contented.
  • #2
  • May 14, 2012 4:19am May 14, 2012 4:19am
Quoting pt49
This thread is for our Gappies... traders who trade gaps in the markets, usually Monday mornings.

Gappies are a deicated bunch who insist on this crazy illogical method of trading.

I must say I don't trade gaps, and based on the last few weeks I'm glad I don't.

Don't be shy, post you thoughts on Gap trading, how you decide on stops (if you use them) which pairs are more suited to trading gaps etc

You can even call me an idiot and I won't be offended.
I wouldn't say you're an idiot but you'd do better posting something constructive about how to trade than to try to dissuade people, no matter how deluded, from trading their own beliefs about the market and it's dynamics.
  • #3
  • May 14, 2012 4:22am May 14, 2012 4:22am
Gaps DO NOT exist for the MARKET. Trading takes place during weekend too and if you have a good broker(yeah that takes more then 100$) you can trade during weekend too.

That being said...anybody who trades gaps after reading this deserves to lose all his money.
  • #4
  • May 14, 2012 4:27am May 14, 2012 4:27am
if you really want to trade gaps then you need to understand them, theyre liquidity gaps not price gaps... Steve W covers them on No Brainer Trades... they happen all the time not just monday morning
tradewith60
  • #5
  • May 14, 2012 7:14am May 14, 2012 7:14am
Quoting 60minuteman
if you really want to trade gaps then you need to understand them, theyre liquidity gaps not price gaps... Steve W covers them on No Brainer Trades... they happen all the time not just monday morning
I did say "usually" Monday mornings. Of course gaps occur a thousand times a day, but the only traders who see those thousands of gaps are those trading 1 minute charts.
In the days of old when sailors were bold, and seldom if ever contented.
  • #6
  • Edited 7:27am May 14, 2012 7:16am | Edited 7:27am
Quoting Hugh Briss
I wouldn't say you're an idiot but you'd do better posting something constructive about how to trade than to try to dissuade people, no matter how deluded, from trading their own beliefs about the market and it's dynamics.
If you're saying my post was destructive, then you sir, are deluded.

As for posting something constructive on how to trade I've done that often enough I think. I did start a thread on how to trade a particular price action strategy a few years ago http://www.forexfactory.com/showthread.php?t=175346, and I'm proud to say its one of the very few threads on Forex Factory that has not been hijacked by some noobie who wants to morf a good strategy into a stoopid EA.
In the days of old when sailors were bold, and seldom if ever contented.
  • #7
  • May 14, 2012 7:24am May 14, 2012 7:24am
... and I'm fairly confident this thread won't get hijacked fopr an EA inventer
In the days of old when sailors were bold, and seldom if ever contented.
  • #8
  • May 14, 2012 7:55am May 14, 2012 7:55am
Quoting pt49
I did say "usually" Monday mornings. Of course gaps occur a thousand times a day, but the only traders who see those thousands of gaps are those trading 1 minute charts.
read the article, you will see what i'm saying, its not visual gaps in price, its liquidity gaps
tradewith60
  • #9
  • May 14, 2012 7:59am May 14, 2012 7:59am
Quoting 60minuteman
if you really want to trade gaps then you need to understand them, theyre liquidity gaps not price gaps... Steve W covers them on No Brainer Trades... they happen all the time not just monday morning
this is the first time ive read any sense on this forum regarding gaps.60 mins is spot on.gaps are as 60 minutes has said lack of liquidity,these 70 80 pip candles on 1min charts are exactly that,very profitable if you know when to fill them,although we dont see it on fx markets very often,you can somtimes see exhaustion gaps after long directional moves,similar to those seen on stock charts,there are other more revealing factors related to gaps,but im not going to give them .
just because the charts we use dont seem relevent because they are independant dosnt mean they dont have meaning.
a little similar to black holes
  • #10
  • May 14, 2012 8:11am May 14, 2012 8:11am
Well, check out our member Hiddengap and you´ll have the best resource available on this friggin´ planet when it comes to gap trading.

  • #11
  • May 14, 2012 8:40am May 14, 2012 8:40am
Quoting pt49
If you're saying my post was destructive, then you sir, are deluded.
No, just pointless and in the wrong place.
  • #12
  • May 14, 2012 9:15am May 14, 2012 9:15am
http://www.nobrainertrades.com/2011/...-removals.html

Inserted Video
tradewith60
  • #13
  • Edited 9:54pm Jun 4, 2012 9:35pm | Edited 9:54pm
Quoting 60minuteman
http://www.youtube.com/watch?v=-8Qf0...layer_embedded
This guy is awesome at picking entry points on charts of the past.
  • #14
  • Jun 4, 2012 10:26pm Jun 4, 2012 10:26pm
Gaps is an interesting concept in FX. Originally I traded a lot of stocks, those were gaps baby! I still remember a position turning into a 1% managed risk to -25% because of the "open gap" while I watched the market tumble in pre-market hours. This is when I started looking at other markets.

Gaps in Forex, even in the literal term, could be many things, but they mostly refer to liquidity. In short, gaps can be located and often they do fill. However, it's important to note that a gap could take a long time to fill, maybe days, or in the extreme, months, weeks, or years.

I never took a huge look at this since the market runs on 24 hour liquidity. I was better off understanding the probabilities of the time of day and locations that breakouts occur rather than looking at market gaps.
  • #15
  • Jun 4, 2012 10:41pm Jun 4, 2012 10:41pm
Cut off the asian session. You then have your gaps and still strong price levels that actually matter. I have been doing this via futures a long time...though you would have to start from the euro open in currencies as it is very relevant.
  • #16
  • Jun 4, 2012 10:57pm Jun 4, 2012 10:57pm
Recently, I've become interested in trading gaps of very volatile stocks using a method similar to Scott Andrews of "Master The Gap". I've watched and studied gapping stocks after finding them using a stock screener on Finviz. One of the tricky things about trading (actually I'm in the PaperMoney training phase), is to determine the strength of the price actions in the recent days on a daily chart and compare this to a 5 minute chart.

I know this is a Forex forum and I've started to study concepts of forex trading, but I'm still into stocks. I would think there might be some similarity or even a correlation between the movements of the stock market and the forex market. What are you observations?
  • #17
  • Jun 4, 2012 11:05pm Jun 4, 2012 11:05pm
Quoting 60minuteman
http://www.youtube.com/watch?v=-8Qf0...layer_embedded
That's a good video... and it's more than just gaps.... that video is a course on Support and Resistance - which is really what trading is all about. +1
  • #18
  • Jun 4, 2012 11:13pm Jun 4, 2012 11:13pm
Quoting qwerty00
Cut off the asian session. You then have your gaps and still strong price levels that actually matter. I have been doing this via futures a long time...though you would have to start from the euro open in currencies as it is very relevant.
You got it, I'm assuming you are look at them as "liquidity gaps" then. What some see as liquidity gaps I call rotations, the liquid rolls of the market. My personal experience of a gap is when I couldn't actually execute in or out of the market, or at least it was a struggle (stocks pm/ah).
  • #19
  • Jun 4, 2012 11:51pm Jun 4, 2012 11:51pm
Quoting 2+2=4ex
This guy is awesome at picking entry points on charts of the past.
haha, +1
  • #20
  • Jun 5, 2012 1:37am Jun 5, 2012 1:37am
Here's a simple example from today....
Attached Image (click to enlarge)
Click to Enlarge Name: EuroGap.JPG Size: 64 KB
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