SPY and Gaps: Essential Data for Traders and Investors
🔍 Research Data:
Analysis Period: 12/31/1999 to 08/02/2024
Target Asset: ETF SPY
Time Frame: 1 Week
Total Candles: 1284
Candles with Gaps: 241
Percentage of Gaps: 18.77%
However, only 33 of these gaps, or 13.69% of the gaps, remained by the end of the week.
What is a Gap? Gaps are spaces on the chart where no trading occurred. They form when the opening of a candle is higher than the previous candle’s high or lower than the previous candle’s low. Gaps are usually caused by significant news or events that occur outside of normal trading hours.
Why is this Important? For traders and investors, understanding the occurrence of gaps is crucial. This data reveals that although 18.77% of weekly candles present gaps, the majority of these gaps do not persist until the end of the week. This can be used to adjust positions and create specific strategies that take advantage of the potential return to previous gap levels.
Possible Strategy:
Condition: Candle opens below the previous candle's low
Entry: Buy at market
Target: Previous candle's low
Exit: Candle close if the target is not hit;
Disclaimer
⚠️ Important Notice:
Personal Data: The above research is based on my personal data and analysis of the weekly chart of the ETF SPY.
Independent Verification: I strongly recommend that you conduct your own research to confirm this scenario before using this information.
Strategy Testing: Always test your strategies in simulated environments or with capital that you can afford to lose before applying them in the real market.
If you found this information useful, give this post a boost! Don't forget to follow me for more trading insights and strategies. Let's connect – drop your thoughts and experiences in the comments below! 🚀📈
Analysis Period: 12/31/1999 to 08/02/2024
Target Asset: ETF SPY
Time Frame: 1 Week
Total Candles: 1284
Candles with Gaps: 241
Percentage of Gaps: 18.77%
However, only 33 of these gaps, or 13.69% of the gaps, remained by the end of the week.
What is a Gap? Gaps are spaces on the chart where no trading occurred. They form when the opening of a candle is higher than the previous candle’s high or lower than the previous candle’s low. Gaps are usually caused by significant news or events that occur outside of normal trading hours.
Why is this Important? For traders and investors, understanding the occurrence of gaps is crucial. This data reveals that although 18.77% of weekly candles present gaps, the majority of these gaps do not persist until the end of the week. This can be used to adjust positions and create specific strategies that take advantage of the potential return to previous gap levels.
Possible Strategy:
Condition: Candle opens below the previous candle's low
Entry: Buy at market
Target: Previous candle's low
Exit: Candle close if the target is not hit;
Disclaimer
⚠️ Important Notice:
Personal Data: The above research is based on my personal data and analysis of the weekly chart of the ETF SPY.
Independent Verification: I strongly recommend that you conduct your own research to confirm this scenario before using this information.
Strategy Testing: Always test your strategies in simulated environments or with capital that you can afford to lose before applying them in the real market.
If you found this information useful, give this post a boost! Don't forget to follow me for more trading insights and strategies. Let's connect – drop your thoughts and experiences in the comments below! 🚀📈
Note
Hello traders!! Despite the low probability of the opening being higher than the previous high or lower than the previous low (18,83%), if we do open with this gap, there is a strong expectation (~85%) that it will be closed by the end of the week.
Stay tuned and use this information to achieve the best possible returns this week! Happy trading!
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.