gaps in the emini ES

M

mcteague

How and when do gaps occur in the ES?
One might think that you could enter a position and then attach a trailing stop before going to sleep. Recognizing some slipage, you would expect your stop to be filled within 1point.

I am saying this because it trades almost 24 hours, so gaps should be rare?
Is this just a horrible mistake that can only end in ruin?
And is it generally better to use trailing stops or trailing limit stops for the emini ES?

Thanks for any replies
 
Gaps do occur though they are rare...no more than 5 times a year off the top of my head. I'm sure you could pull up some historical data and look through it yourself. Keep in mind the ES isn't traded on weekends (well a good chunk of it) so that's where many gaps will occur (Sunday afternoon open).
 
Thanks
I just want to add that I am not necessarally recommending the rip van winkle technique of emini S&P trading. Only asking about how and when gaps occur
 
Unless I have 10pts of profit in ES/S&P500 futures, and I just entered on the trade in past 1-3 days, I would have some options bought for over the weekend. Anything can happen and I rather have some kind of hedge, otherwise one is just gambling.

I don't recall the size of the gap when markets reopened after 9-11.

I recall long ago I got caught in a limit down move for three days in diff market, cost me $110k, not saying the indexes could do this, but anything is a possibility.
 
never saw the point in stop limits

maybe if you're sitting there watching it

but if you're sleeping, all you know is you want out

that's not a time to be quibbling over a couple of ticks

if anybody can make a case for stop limits I would like to hear it
 
with the economy in it's current state the odds of the spx opening 20 pts higher is unlikely,but if it did, it would be big, i use a 20 point stop to the upside,along the same lines,the likelihood of it opening down 20 is much stronger, so just don't go home naked short
 
It seems like you could hold positions somewhat blind as a day trader; with the following exceptions.
Be flat at these times:
1. On the weekend hours when no trading occurs
2. During the daily maintainance windows
3. 15 minutes before and after ny, london, and Hk open and close (perhaps to conservative)
4. At least 1 day before expiration.
All other times when not at the screen trailing stop is preferred method
Thanks
 
Quote from ammo:

with the economy in it's current state the odds of the spx opening 20 pts higher is unlikely,but if it did, it would be big, i use a 20 point stop to the upside,along the same lines,the likelihood of it opening down 20 is much stronger, so just don't go home naked short
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I just routinely put in a limit to sell 20 points above the close. I almost never get filled, but I figure one of these days I'll catch a panic stop.
 
Quote from feng456:

Gaps do occur though they are rare...no more than 5 times a year off the top of my head. I'm sure you could pull up some historical data and look through it yourself. Keep in mind the ES isn't traded on weekends (well a good chunk of it) so that's where many gaps will occur (Sunday afternoon open).
More...

Gaps are rare in ES?

Well, from the top of my head, you could not be more wrong. :)
 
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