what do gaps on my forex chart mean?
The gap on the charts usually appears after a weekend or some major holiday like christmas or new year.
Even though retail forex brokers dont allow you trade over the weekend, the friday closing price is always different from the monday reopening price because any major news or event that occurs over the weekend is factored into the monday reopening price causing it to be different.
The gaps mean no trading took place within that period probably because it was a weekend. The gaps can act as levels of support and resistance sometimes so you can find a way to use this to your advantage.
Gaps can also occur on weekdays so it is not limited to weekends only. Today is thursday and see the attached image showing a gap on eurusd chart. The gap shows us price has changed even without anybody trading and this could be because of some breaking news event that just happened. This moment i checked the news which showed Gun men just carried out a terror attack on israeli embassy staff in washington DC, this could be the cause of the gap. https://edition.cnn.com/us/live-news/israeli-embassy-washington-dc-shooting-05-21-25
Gaps can also occur on weekdays so it is not limited to weekends only. Today is thursday and see the attached image showing a gap on eurusd chart. The gap shows us price has changed even without anybody trading and this could be because of some breaking news event that just happened. This moment i checked the news which showed Gun men just carried out a terror attack on israeli embassy staff in washington DC, this could be the cause of the gap. https://edition.cnn.com/us/live-news/israeli-embassy-washington-dc-shooting-05-21-25
When gaps appear on the charts during weekdays, some traders call is "Fair Value Gap" and the idea of fvg strafegy is that price will always come back to close the gap so when you see price moving towards the gap, you trade that direction.
The grey circle is an example of fair value gap. Price closed above (green candle) but opened below the closing price (red candle)
It means price moved without trading taking place, so something else caused the price to move (such as breaking news, dark pool trading etc.)