Obviously in forex the market only closes on the weekend. Does this mean u can basically forget trying to spot candlestick patterns that require gapping such as the bullish/bearish engulfing and piercing line patterns on anything below the daily time frames? Or can you ignore the gapping criteria for these patterns. I am getting mixed messages from lots of different websites.
I’m pretty sure u can forget the gapping for the engulfing patterns, am I right? And what about the others.
Gaps are crucial for some candlestick patterns. You’re right, in forex they won’t work as well or as reliably as the books say they should.
It’s important to understand the price action of what the candlestick pattern is showing.
For candlesticks with gaps like engulfing and harami patterns, I wouldn’t recommend ignoring the gapping criteria because that’s what’s make it a distinct candlestick pattern in the first place.
Gaps do exist in FX, they’re just rarer. What makes it more difficult to spot gaps is that since there is no “one” price for currency pairs (since FX is an OTC/decentralized market), OHLC prices differ according to your trading platform.
Unless there is a massive price thrust up (or down), you might see a gap of say 2 pips on your chart, while I may not see a gap at all.
i tried trading gaps before. i think there are much more probable strategies out there if im honest. Highest probability is the key in this game