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Gap

A jump between one period's close and the next period's open with no trading in between.


Forex trades continuously through the week, so intraday gaps are rare, but the weekend break produces them regularly: news between the Friday close and the Sunday open is expressed as a jump in price rather than a movement through it.

Gaps are the reason a stop loss is a risk-control tool rather than a guarantee. If price opens beyond your stop, the order triggers and fills at the new market price, which may be materially worse than the level you chose.

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