A short instructional YouTube clip by Jesse Rogers explaining three common mistakes traders make when trading fair value gaps: trading every gap, failing to wait for confirmation, and using improper stop placement. Rogers offers corrections for each mistake and promotes an upcoming live class.
Your fair value gaps fail you because you choose the wrong ones. First mistake, you trade every fair value gap that you see. Not all gaps are created equal. You need the gap to form at a significant level, not in the middle of a range. Second mistake, you don't wait for any confirmation because after price tests a gap you need to see an engulfing candle form and that is your confirmation that the gap is holding. Third mistake, you use the wrong stop placement. Your stop should go beyond the gap and not inside it because the market can always decide to trade deeper without invalidating the gap, which means your stop loss is in the wrong place. Fix these three mistakes and fair value gaps will become one of the most reliable tools that you'll ever trade. Now send this to a friend who's also struggling with them. If you want me to walk you through this step by step on my upcoming live class, comment the word class and I'll send you a free ticket before they're gone.
