This simple NASDAQ gap strategy will help you to trade the Monday NASDAQ open gaps profitably. How ever the strategy have its down side which is related to the risk to reward ratio.
How to trade Nasdaq Gap Strategy??
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The NASDAQ gap strategy is just simple and straight forward however it requires precision, we cannot just trade any gaps that we see. Avoid gaps that are too small or to big.
Total Time: 3 minutes
Identify and measure the gap
The gap is formed by the difference in price between Friday’s last candle close and Monday’s first session candle open. The gap is usually induced by fundamental events that takes place while the market is closed. Mark the gap with a box.
Duplicate the gap box
Now that we have identified our gap with the box. We need to duplicate the box to the opposite side(The side opposing the gap). if price gaped low, the second box have to be place below the gap.
Once the gap fulfills all necessary conditions outlined above. You want totake trades as soon as possible. This strategy is a bit aggressive since we do not wait for candlesticks confirmations at all. Download advanced Nasdaq gap strategy PDF
This YouTube video shows the NASDAQ gap strategy step by step!!