The scattergun approach is certainly tempting, and I think last week I took positions on six gaps straight up...
Now supposedly there are odds of 9 out of ten gaps being filled. I have not ever tried to verify these stats so cant really attest to their voracity.
Bearing this in mind then fer sher the scattergun approach SHOULD see profits far out weigh the 1 in ten loss.
Reasonable time for expectation of gap fill:
tough one... I have seen gaps filled within the hour and also seen gaps take a week to fill.
this is actually a big influence on my trading strategy, and in a nutshell this is what I do (I posted this on the last or next to last gamonday gap thread here, but cant be stuffed finding it so will just give a brief rundown of myapproach)
Gap occurs - Immediately place a small trade opposite gap with profit stop at gap fill
Go away for about 10 mins or so
Reassess market and look at it with my favourite indicator the MACD on the 1 minute level.
If Gap remains open and has widened, and MACD on 1 min is sugggesting momentum is changing towards the gap being filled, get aggressive and add to position ( Go away for an hour or so and return and re asses.
If gap is closed, count the money and rejoice :)))
If gap still open but aggressive position inpositive, consider taking partial profits or placing stop loss.
When gap is within 10 pips of being closed , stop losses in and tight.
Lately on the gaps that have taken a week or so to fill I have made the most profit, as with these fellas, I've managed to hold a position initially for partial gap fill, taken profit/been stopped out, but remained with my initial bias towards the gap fil and used the time over the week to find better entries through indicators on larger timespans and either milked the price moves scalping towards gap fill or building up a possi on the larger timespan as the week and eventual fill plays out.
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But that is just me and I am a hyper active individual who lovves to play with my positions...
a position open on the open of the gap, and then a chill out for a week sure seems like a high probability approach.
