Weekend gap in FX

Discussion in 'Forex' started by vivanov, Oct 27, 2006.

  1. vivanov



    I've just one simple question. In your experience which currency pair gaps most often during the weekend?

  2. Depends on the News, Japanese YEN once gapped 800 pips
    although it was a long time ago.
  3. djxput


    800 pips ... wow
  4. Which war, terrorist attack, assassination, etc. caused this?
  5. I realy wouldnt worry about weekend gaps on major pairs. I always have at least a position or 2 open (24/7), and have never been been bothered by weekend gaps. Weekend gaps on major pairs are genaraly small if there is even any gap at all. Furthermore, once in a while I get a litle 20 or so gap against me one week, and then sometime down the road its goes in my favor... no big deal. Finaly, after trading for many years, I have noticed that gaps are becomming less and less frequent over the years as FX liquidity grows.

    Don't worry about weekend gaps on major pairs... highly exotic currencies are another story.
  6. I have not seen that. Can you confirm this (date) ? As far as I can see, no such gap has occured since at least 1987 (if ever).

    Are you sure you are not just mistaking bad data for actual market price ?
  7. I just went back further. No such gap since at least 1976 (if ever). 1976 being just after the inception of tradeable free-floating FX as we know it, it is safe to say that an 800 pip gap in usd/jpy has never happened and is an unrealistic fear.
  8. The most exotic pairs. ... pairs that you would never even trade such as some South American/African cross.

  9. The Plaza Accord was an agreement signed on Sunday September 22, 1985 by the then G5 nations (France, West Germany, Japan, the United States and the United Kingdom). The G5 agreed to devalue the US dollar in relation to the Japanese yen and German Deutsche Mark by intervening in currency markets.
  10. I dont not have intra day data but my end of day data says:

    Firday Sep 20 1985: close 238.15
    Monday Sep 23 1985: close 225.78

    Thats over 1200 pips.

    I read that 800 of that 1200 was on the open.

    The YEN was trading at twice the value back in 1985 so translated today a similar percentage move would be 400 pips. Still huge.
    #10     Oct 27, 2006