KeTrader

EURDKK Example of Trading Gaps

OANDA:EURDKK   EUR/DKK
I don't trade this pair, but it provides a good opportunity to show how one would trade a gap since it made an extreme extension. Basically marking the highest or lowest point and switching from candlesticks to line you would see a big gap. The market normally retraces the entire length of the gap before continuing in the direction it was heading. So you would ideally be making the money in this one going up and going back down again.

Just a trick I use sometimes and maybe useful to others.
Penafian

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