Opening gaps (NWOG and NDOG)

What it is

On futures, a new week opening gap (NWOG) is the range between Friday's close and the Sunday evening open; a new day opening gap (NDOG) is the range between one day's close and the next day's open.

These gaps act as reference levels: price is often drawn back into them, and their midpoint is watched closely.

How to spot it

• Mark Friday's close and the new week's opening price; the space between them is the NWOG.
• Gaps are clearest on futures, which close each weekend and briefly each day.

How to use it

• Use unfilled gaps as targets, and their edges and midpoint as levels for reactions.
• Keep the last few weekly gaps marked; they can matter for weeks.

Common mistakes

• Assuming every gap fills immediately.
• Looking for them on instruments that trade straight through, where there's no real gap.

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