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Friday, 30 April 2010

Gap Trading Tips

Know the zone! Where the gap opens relative to prior day support and resistance (e.g. Open, High, Low, Close) will greatly influence its probabilities of filling, as well as the optimal placement of your stop and target. It’s a three legged stool. To maximize profits focus on gap selection, stop placement, and target optimization. It takes all three. Don’t try to kiss all the pretty girls (or guys)! With gap trading, it pays to be selective. So, when in doubt, sit it out. The return may not be worth the risk. Just because a gap is small...