Le Sunday Gap

[techno791]

I was inspired yesterday, when I realized, "wait a second, it's all supply and demand, these technicals that work in the pennies work here. Why would I drop them when they've worked so bleepin well!".

I put it together after I hope I figured something out with economic reports, and watching the sunday gap fill itself. The last two weeks I keep missing the fill, but the gap has been really small anyway.

But Today, the 26th of January in the year 2007, check this out:



This is the type of thing I would've loved to play in the market if I could have leverage, and no SEC daytrade rules, or margin rules about how you can't buy the same stock twice, and so on rules.....

Blue bar on the left is friday close. #1 is Sunday open. Gap, fill. Very small, only about 10 pips or so.

#2 is where the gap stopped and reversed, right on the line of Friday's close. It's now support. Gap was filled, bounced off and up.

#3 My favorite; the type of thing I used to watch out for. When a gap and fill, and reverse back in original gap trend, it broke the mark, and flew. 12-13 pips.

#4 I don't know if this is acceptable or valid. If you can break the line twice in two directions. But now you would've done the original fill the gap, and a break of the previous close. About 10 or 11 more pips.
...Or maybe did it break the open, and point four is supposed to be at 1.9600 instead. Which would be a perfect coincidence, I'm not sure.

All the stuff I used to watch in stocks. All basic rules of lines, gaps, and supply/demand. Unfortunately in Forex, you only have one open a week. You don't get too many tests.

Last week on the 21st was very hard to follow, a lot of whipsawing. But then again, not every gap and run on a stock works textbook either. You'll just have to take the outliers for what they are.

And since it's all textbook, I'm not giving any secrets or systems out that you can't get in any wholesale bargin basement book. So good luck in whatever market with those. I hope they work frequently.

[techno791]

Todays open reminded a lot of a technique I heard about for stocks that opened with heavy trading the day before. it opens, then the price comes down immediately, followed by an up and breakout. Worked out okey, but I never got the perecntage I wanted at first...and then forgot(I'd like to do it again now).



In this case I'm not sure if they should consider the open the breakout line or the previous close. This is where it differs in that stock example, I didn't have a techncial gap nor followed the previous close, just the open. But apparently the previous close was a mini-support, as you can see that candle wick bouncing off of it. So maybe it's the upper line.

I tend to miss all of this and log in 45min after open. Last week was lacking any action. But maybe, just maybe, the old stock skills can transfer to sundays? Be perfect on a lot of peoples schedules if it all checks out. Nerve racking since it's only once a week if you ask me, can't get adjusted to it. And it's not some super secret system. Just regular technicals that can be found on the internets or some books.

[Woody55]

RPM posted the Sunday closing gap strategy here. I back tested it and said hell, this is a no brainer. The first time I did it, I lost 50 PIPS. Never tried it again, even though I've watched it work several times. Guess I just picked the wrong Sunday and now I'm gun-shy. Good luck with it.

[techno791]

I think I remember his. Close the gap and bust through open or something. I watched it once the week before the thread, didnt work! I'm basically watching the same way I'd watch the stock market when it opens and trying that out.

I may post the chart from this week. It's a little werid. I'm not sure if we filled the gap at open or not, we never touched Friday's close before London, BUT that line for Friday's closed worked as a great support that busted at 5:30am NY time.