Better System Trader

018: Scott Andrews 'The Gap Guy' talks all about Gaps, why they work, how to pick the best Gaps and avoid the worst, Gap Zones and setting stops and targets. PLUS we discuss a concept called 'Ensemble

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Scott Andrews 'The Gap Guy' shares his expertise in gaps, why they work, what factors to take into account when trading gaps and what to avoid. We also discuss gap zones, when to fade and when to follow and calculating stops and targets.

PLUS, for those that aren't into Gap trading, we cover some important concepts that can impact all styles of trading, include one concept called 'Ensemble Systems' which may just change the way you look at trading strategies.

Topics discussed
  • Why it’s important to trade a style that matches your own strengths rather than follow someone else
  • Why gap trading works
  • Markets where gaps work best and those that don't
  • The best type of stocks to trades gaps and the stocks to avoid
  • The benefits of trading gaps in indices vs stocks
  • The 3 market conditions to look at when analysing a gap
  • How seasonality impacts gap trading
  • Signs of gaps to avoid
  • Using ATR to determine the probability of gap size closing
  • Gap zones and how the location of the gap can provide useful information
  • The worst performing gap zone
  • The psychology of certain gap zones and why some work better than others
  • When to fade the gap and when to follow it
  • Calculating stop and profit levels based on gap characteristics and market conditions
  • How to determine if a target should be a full gap close, partial gap close or an extended target past gap close
  • The impact of QE on gaps
  • How to combine systems into Ensemble Systems for an interesting view on trading strategies

    •  

    ...more
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    Better System TraderBy Andrew Swanscott chats with professional traders Larry Williams, Ernest Cha
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