Trading methods for gaps
Aps can be seen in various markets, including forex. Experienced traders always take advantage of this opportunity. But such trade requires some knowledge and experience. For novice traders, trying to make money on gapahs often brings losses instead of expected profits. Trady on the is not as simple as it may seem. Therefore, I decided to make some recommendations that can be useful especially for beginners in the market.
To begin with, I will remind you what the gap is. Simply put, this is a significant price gap. On Friday, the market closed on the stock exchange of listed instruments occurred at a certain level. At the same time, when the market opens on Monday, the price is very different from it. It broke up. The reasons may vary. At the weekend, there may be a change in the mood of buyers and sellers under the influence of certain factors.
Trading Rules for Loophole
First of all I want to warn you that if at the time of market opening you saw a gap, then take your time to do something immediately. First, you need to make sure of its reality. To do this, you need to check if other brokers have a gap.
Signals to Market Entry
Gap Transactions suggests earnings at close. This means that the trader expects the price to return sooner or later to the price level at the close of the Market Friday.
To make a trading decision or refuse to enter the market, we will use a moving average.
Gap transactions can be effective if one of the two quality signal options is available.
If ma is facing down and the gap has increased, then there is a high probability that the sale will close at a profit.
By analogy. If the moving average is up and the difference is down, it means you can open a trade to buy. Most likely, this will bring profit to the trader.
Traps for the trader can become opposite situations.
Do not enter the market if:
IS is facing upwards and the gap has occurred upwards;
moving average is down and the difference has fallen.
Despite the fact that the methods I have spoken about are quite easy to understand, do not rush to apply them in real trade. Try to find similar market situations in history and see how these methods work effectively. Then use them in demo trading. Once you have acquired your skills, you can go on to earn a loophole in real trading.
Record Trading Methods on Gap first appeared Magazine for Forex traders | forex-for-you.ru.