BEST WAY TO TRADE GAPS IN FOREX MARKET
The best way to trade market gaps in Forex market is by mastering the stages of the trend/cycle therefore knowing the four types of market gaps we have and their importance in a trend.
There are 4 types of market gaps in the Forex market:
Common gap - This is a market gap that is found in a consolidation
It shows that the consolidation is about to come to an end and the direction in which the market gaps is the new market direction.
Traders in Forex market can use this market gap for sniper entries in swing trades giving maximum yield.
Break away gap - Found after the end of the consolidation.
This market gap is extra confluence of the new market trend
It also offer swing traders an opportunity to join the freshly established market trend
Continuation gap - This market gap is found at the middle of the trend
Its a sign that the trend still has some volumes to push
Any trader who missed the entries earlier can also use this market gap to gain something form the trend.
Exhaustion gap - This is a market gap that appears at the end stage of a trend
Its a signal that the trend is coming to an end and traders holding positions should prepare for an exist
Also traders who did not take part in the trend can use this gap to milk the last push of the trend. Usually, this last push has great volume.