I have been trading these gaps counter trend for quite a while now and agree they work pretty well. Long the audusd and audjpy tonight and up 64 pips so far.
Yeah, both those were nice gaps to trade. Looks like they will come out successful.
over this weekend , monday
GBPUSD is DOWN gap -- how should we trade it
better with some illustration --- I still don't quite get it
Since it gaped down, you would go long, hoping the gap will get filled.
unlike the previous monday , the gap is not filled --- i.e. the gap is not close before it go down -- just straightly down to hell -- as GBP (no export currency)
but the other monday -- it is USDX got the gap
today is only GBPUSD got the gap, no other currency
GBPJPY gap filled nicely today!
Good to see traders making money!
Good to see you guys are taking advantage of all these sweet gaps as well!
As stated previously in this thread, 3.5x risk for reward is the max you should use for a stop, as my research shows. This will also give you the highest probability.
I've found the cross that has the largest gap tends to have a slightly higher probability than most of the others.
However, taking several gaps at once to diversify risk is also a great option.
If you have time to watch the trade work itself out, you may want to consider cost averaging as well. With a little imagination, you can pull montrous profits out of these, and make "a second payday" for yourself....at least about 30 weeks out of the year that is.
Cheers! And good trading!
Expected % gain
The "net pips" you speak of have no relevance on profit. This is why: If you set out to risk 4% of your account size to make a 1% profit every time there's a gap...your account would grow by 1% on each profitable gap. This would be compounded, so at the end of the year, you'd have a very respectable net % gain on your account.
This is the magic of compounded gains, working in your favor, about 90+% of the time, all-in-all, risking 4 to make 1...which mathematically has a positive expectancy over time.
(As your account grows, you're trading more lots per trade.)
Hope this helps.
NO, I haven't tested it yet. Need to wait until Sunday at market close to attach the EA.
I coded the EA to check these 19 pairs:
EURUSD, USDJPY, GBPUSD, USDCHF, USDCAD, AUDUSD,
NZDUSD, EURGBP, EURJPY, EURCHF, GBPCHF, AUDJPY,
CHFJPY, EURCAD, EURAUD, AUDCAD, AUDNZD, NZDJPY,
Most brokers have these pairs right? (I'm using IBFX)
Anyone can feel free to improve the code if necessary. Like I said, it hasn't been tested yet, so it may need some tweaking, especially in the TP & SL parameters.
Thanks for developing this!
Could you tell me a little about it's logic, and gap size parameters so I may better understand what it's looking for every Sunday evening?
hey guys, new to this forum, look forward to checking this out.