I'm trading from last 2 years, started from Indian Stock Market and join the cryptos and forex as well yeah may be you will think that I'm a newbie but trust me price action is the real king.
Today I am sharing one of my favourite strategy the gap with power candle confirmation, so in this tutorial I'm going to tell you How I personally trade gaps the strategy is very simple and easy to understand.
As you can see in the above image the chart is a index chart of S&P 500, there is a gap up opening at 15 October 19:00(UTC+5:30) with creating a gap up in 15 min. timeframe, the gaps are of 3 types and I really don't know the name of the gaps just know how to react on these, now come to the point at 18 October 19:00(UTC+5:30) on 15 min. timeframe the price made a green hammer candle with lows touching the gaps as support and that's the point at the gap if there is a healthy bullish hammer candle then we can initiate a buy trade by placing the stop loss just below the lower levels of the candle and can expect a R:R of 1:1.5 minimum .
Don't follow it blindly be sure to backtest this before execution.
Happy to share this my first Idea.
- NITIN