What a gap is
A gap is a jump in price with no trading in between. The chart shows one price, then the next available price is far away, and nothing traded at the levels in the middle.
In forex and CFDs, gaps appear mostly in these situations:
- Weekend close. The market stops trading late on Friday and reopens on Monday. News during the break, such as elections, central bank statements or political events, is priced in at the open.
- Daily breaks and session closes. Stock indices, energies and some metals have daily pauses. The price can reopen away from the last quote.
- Scheduled news. Interest rate decisions and major data releases can make liquidity disappear for a moment, so the price skips levels. See trading news risks.
- Unscheduled events. Sudden political, economic or company news can move prices before you can react.
Crypto CFDs may trade at different hours from forex, so their gap pattern is different. See crypto CFDs.
Why stops are not guaranteed in a gap
A stop loss is an order to close your position when the price reaches a level you set. In normal trading it fills close to that level. In a gap, the price never trades at your stop level. The order is then filled at the first available price after the gap. That price can be much worse than your stop.
The difference between the stop level and the actual fill is slippage. In a weekend gap, slippage can be large, and the loss can be bigger than the amount you planned to risk.
The same applies to pending orders. A buy limit or sell stop can be filled at a price beyond the level you set, because that is where the market reopened.
Leveraged CFD and forex trading can lose money fast. A gap can move the account from a normal loss to a margin call or stop out in a single price jump, with no chance to act. More on this in where to place a stop loss and trading without a stop loss.
Scenario table: what a gap can do
| Situation | What happens to orders | Effect on the account |
|---|---|---|
| Price gaps against you, but stays before your stop | Stop not triggered | Open loss grows. Free margin falls. |
| Price gaps through your stop | Stop fills at the first available price | Realised loss larger than planned |
| Price gaps through your stop and the stop-out level | Positions may be closed by the stop-out rule | Large loss, possibly most of the account |
| Price gaps in your favour beyond take profit | Take profit fills at the opening price | Fill may differ from your level |
| No stop on the position | Nothing closes the trade except stop out | Loss limited only by margin and stop out |
| Several correlated positions open | All gap in the same direction | Combined loss larger than any single trade suggests |
For the last row, see correlation risk.
Check your margin before the close
Margin level is equity divided by used margin, shown as a percentage in MetaTrader. Margin call is a warning level. Stop out is the level where the platform starts closing positions. The tool below shows your margin level and the prices where margin call and stop out would happen.
Fill in the empty fields to see the result.
Margin level = equity / used margin × 100%. Equity falls with the floating loss; the price for a level L solves balance + P/L = L × margin. Margin is taken at the entry price. In a gap the position can close at a worse price.
Enter your balance, position size and open price. Then compare the stop-out price with how far the instrument has moved over past weekends or news events on your chart. If a normal gap could reach the stop-out price, the position is too large to hold through the close. Use the result as a check. It does not predict where the market will open.
If you trade with Exness, check the trading hours and margin conditions for each instrument in the Exness personal area or on the official site.
Ready to try it on a real or demo account?
Partner link · trading carries a high risk of loss
Ways traders manage holding trades over weekends
These are common risk controls. None of them removes gap risk or guarantees a result.
- Reduce size before the close. A smaller position means a gap costs less. See position sizing.
- Size for the gap, not only the stop. Ask what you would lose if the price opened well beyond your stop, and whether you could accept that loss.
- Lower effective leverage. Effective leverage is total position value divided by equity. Lower effective leverage leaves more room before stop out. See effective leverage.
- Close before known events if your plan does not allow event risk.
- Keep free margin. Margin left unused gives the account room to absorb a jump. See avoiding margin calls.
- Count the swap. Positions held overnight pay or receive a swap. Some instruments charge extra for the weekend. See swap fees.
- Write it in your plan. Decide in advance whether you hold over weekends, and on which instruments. See the personal risk plan.
A note for traders in Pakistan
Per the SECP, offshore platforms have no Pakistani licence or oversight and offer no legal protection or recourse (per the SECP, offshore platforms have no Pakistani licence or oversight and offer no legal protection or recourse). If a gap causes a disputed fill, you have no local regulator to go to. Read law and regulators before trading.
Frequent questions
What is a weekend gap in forex?
It is the difference between the last price on Friday and the first price on Monday. It happens because news arrives while the market is closed.
Does a stop loss protect me from gap risk?
Only partly. A normal stop limits the loss in normal trading. In a gap it fills at the next available price, which can be far beyond your stop.
Is holding trades over the weekend always a mistake?
No. Some traders hold on purpose. It is a decision about size and risk: the position should be small enough that a large gap stays within a loss you can accept.
Which instruments gap the most?
It depends on the period and the news. Stock indices, energies and some currency pairs often gap around events and session opens. Check the history on your own chart.
Can a gap take my account below zero?
A gap can push equity below the stop-out level before positions are closed. Whether a negative balance is covered depends on the broker's policy. Check the current conditions in your personal area.
Where do I learn more about general risk control?
Start with risk management and risk per trade.