ES Journal - 2012

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Quote from Pekelo:

Everybody shorted the 2nd gap like crazy, right? There was a guaranteed 5-6 points in it....
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Doesn't the market have to officially open before we have a gap?
 
For the late comers, it got repeated and there was another opportunity (2nd gap) after I posted....

Quote from NoDoji:

Doesn't the market have to officially open before we have a gap?
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Of course not. Otherwise it wouldn't be a gap. The gap is made before the open...
 
Quote from NoDoji:

:confused:
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Gap :
(techical analysis) the price difference between yesterday's close and today's open. (or sudden price move without continuity in between)

Edit: I guess your confusion comes from the fact that futures are pretty much continuously traded, as compared to the ETF... Anyhow the 2nd gap rule is based on the ETF, even though you are using the futures to trade it...

Furthermore: After a gap left open, at the close of RTH(4 pm, not 4:15) you look at the futures' price, and take a note. (1431ish yesterday)That price is going to be your guaranteed price for the next day. So in case of an upgap, you can short anywhere above it, with little risk. (or if a downgap, you can go long anywhere below it)
Bigger the 2nd gap, the better the chance that it will close on the 2nd day...
 
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