Dollar, EURUSD and USDJPY Gap - Exhaustion or Acceleration?

By DailyFx | August 25, 2014 AAA

DailyFX.com -

Talking Points:

• Gaps are unusual in the FX market and usually small, but they do occur

• Distinct and substantial USDollar, EURUSD and USDJPY gaps formed Monday morning

• Fundamentals can help determine whether these gaps can establish endings or beginnings of their trends

Want to develop a more in-depth knowledge on the market and strategies? Check out the DailyFX Trading Guides we have produced on a range of topics.

Many stock traders use gaps to signal meaningful technically-based market developments. While they are uncommon in the FX market, they do happen from time to time. To start this week, there was a notable gap on most of the dollar-based majors. However, the bigger moves were realized on those pairs that found the most fundamental encouragement through their monetary policy bearings and this past weekend's Jackson Hole Symposium updates: USDollar, EURUSD and USDJPY. Will FX traders find the same opportunities in these opening moves that their equities counterparts exploit? Are these gaps closer to the end or beginning of the market's trends? We discuss this in today's Strategy Video.

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