Gaps: How do you cope with them?

[ruseneca]

What you are saying is slippage. Slippage is common especially during big news release. There are some brokers that give bigger slippage than others. You can avoid those brokers. And for news trading you need good risk management policy. Without that it's not a good idea to gp for news trading. If I don't have proper weapon and shield, why would I go to the battle field.

I've given an example with a price gap but yes, slippage is very common, especially when it comes to ECN brokers and you are trading with 1 standard lot or more. In this case, the order is routed to the market for exectuion and the slippage might be very high, let's say 5-10 pips, it depends on the liquidity, if you are lucky, order might now be slipped!

As for the gaps, I usually wait for the news to pass. In the first minutes robots are those who are trading, so everything is possible. There are also brokers, market makers, that close the order at the set SL and TP, disregarding of the gap. So, this is another way to cope with gaps but I don't recommend it to newbies.

 

[Morten]

Every person has disadvantages. If he begins to correct them, then the person does not get better, he just replaces some of the disadvantages with the others. A human is a creature that is difficult to please. If someone is delighted with something, then others hate it.

 

[Naxramos]

Price gapping is an inevitable thing. It's more common after weekends, so tend to close all my deals before the weekends.

 

[Addam]

it's always necessary to analyse your drawbacks and losses. you mustn't give up after you fail something, but analyse your mistake and start trading again. You must study on your mistakes.

 

[Nisoro]

Market gaps occur when the market stay close due to holidays. So when it opens on the next day or after couple of days then the gaps occur on the market charts. You have to end the trades on the closing of the markets as these gaps can be devastating for you and are difficult to predict.

 

[Aubrey Aubrey]

Time gap will be remain in forex business because forex market runs 24 hours and trader from all over the world are doing forex business. By news trading this gap minimize a lot. Slippage issue is very common for this gap. But I think it is not a big issue and maximum trader overcome it smartly. Gap should be maintain in the support or resistance area it will give good result.

 

[Herpas]

Disadvantages are subjective. For someone else it's a disadvantage, but for another - it's totally fine. Of course if do not get to extremes. You should fight disadvanteges only if people have noticed them, but if not, then that's fine)