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Forex daily candle close time
Most successful day traders understand that more trades are successful if conducted when market activity is high and that it is best to avoid times when trading is light. Event Planner. Zones by Country. World Time.
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What's My Time Zone? A gap appears on the chart when the opening price of a candlestick moves sharply up or down away from the closing price of the previous bar, in such a way that there is no overlap in the trading ranges. Typically candles on a Forex chart open at the same level where the previous candle was closed. When a candle period is completed, that candle will be closed and a new candle is opened instantly. This is what happens under most normal circumstances.
However, when a gap appears on the chart you see a clear mismatch between the opening and the closing price of the two adjoining candles. The two black arrows show the closing of a candle and the opening of the next one. The red rectangle measures the size of the bullish gap between the close and the opening of the two candles.
In this manner, we have a bullish gap of 28 pips on the chart. Since the spot forex market is very liquid during continuous trading hours, a gap in the price action is most likely to occur with the market opening in the beginning of the new trading week. When the market opens for the new week, at 5pm New York Eastern Time on Sunday, any significant weekend news events instantly affect the price causing the Forex pair to gap up or down depending on the respective influence. As we have just mentioned, Forex gaps typically occur after the weekend, however they can and do occur from time to time during the trading week as well.
In the next section, we will detail some of the most common types of Gaps:.
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The continuation gap appears when the Forex pair is already trending and the currency gaps in the direction of the trend. In this manner, if you see a bullish gap during a bullish trending move, then you have a bullish continuation gap on the price chart. It is absolutely the same in the opposite direction for a bearish continuation gap. If the trend is bearish and the chart creates a bearish gap during a trending bearish price move, then you have a bearish continuation gap. Continuation Gaps form for a myriad of reasons, but the underlying cause is an imbalance in supply and demand.
If the trend is bullish and the price continues the strong trending move upwards, then the bears might rapidly exit their short trades. When this happens, the bearish pressure on the pair disappears in a flash causing an excess in buy side demand, resulting in the Forex pair to gap up.
An exhaustion gap appears at the end of a trend and signals a potential reversal of the price tendency. The gap is in the direction of the trend and to the untrained eye, it could be mistaken for a continuation gap. However, there is a vast difference between the trader psychologies forming these two types of gaps. The exhaustion gap usually appears when the trend starts creating more dynamic price reactions during a relatively shorter period of time. The currency pair turns volatile and big candles could be noticed on the chart.
The pair has created several impulse waves and suddenly, a gap in the direction of the trend is created. Eventually, there are no more people left to trade in the direction of the trend, and the currency pair simply runs out of steam, and reverses its direction.
The image below will show you an exhaustion gap and a continuation gap on the chart. The image starts with a bearish tendency by the Sterling. The red line on the graph indicates the down trend of the pair. See that the last three impulses of the trend are very dynamic. At the same time, the candlesticks are relatively large and have very long wicks. The last bearish impulse, which is marked with the third blue arrow, ends up with a gap in the direction of the trend.
At the same time, the last three bottoms of the trend are relatively close to each other in terms of price. In practice, any color can be assigned to rising or falling price candles. A candlestick need not have either a body or a wick. Generally, the longer the body of the candle, the more intense the trading. Candlesticks can also show the current price as they're forming, whether the price moved up or down over the time phrase and the price range of the asset covered in that time.
Rather than using the open, high, low, and close values for a given time interval, candlesticks can also be constructed using the open, high, low, and close of a specified volume range for example, 1,; ,; 1 million shares per candlestick. Candlestick charts are a visual aid for decision making in stock , foreign exchange , commodity , and option trading.
Closing Price
For example, when the bar is white and high relative to other time periods, it means buyers are very bullish. The opposite is true for a black bar. A candlestick pattern is a particular sequence of candlesticks on a candlestick chart, which is mainly used to identify trends. Unlike with regular candlesticks, a long wick shows more strength, whereas the same period on a standard chart might show a long body with little or no wick.
Candlestick chart are similar to box plots. Both show maximum and minimum values. The difference between them is in the information conveyed by the box in between the max and min values. From Wikipedia, the free encyclopedia. Type of financial chart. This article needs additional citations for verification.
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