What is the ICT New Week Opening Gap?
"This is a concept that I released on Twitter in February 2023"
"The way you want to locate that is you want to go into a lower time frame chart you don't want to use your daily chart because the daily chart is going to be using a settlement price that may not be in alignment with what we're showing you here to use so you can use a one or five minute chart"
"You're going to be using the Sundays opening price... and the closing price on the Friday prior... so it's the open on Sunday and the close on the previous week's Friday being a measurement"
"Midpoint here which is consequent encroachment"
How to Construct the NWOG
Time References
"Friday close price at 4:59 PM Eastern Standard Time that's the East Coast time of the US"
"The opening price here on Sunday at 6 PM Eastern Standard Time"
Using Fibonacci for Consequent Encroachment
"You're going to take your Fibonacci and you're going to Anchor it to Friday's closing price and if the Sunday opening price is lower you're going to drag the Fibonacci down to it anchor it there and then your 50 level... you're going to note that that's going to be consequent encroachment because this is an inefficiency or Gap"
"The midpoint of that is consequent encroachment if it were an order block it would be mean threshold"
Optional Quadrants
"You can add quadrants... if you have the low of the new week opening Gap the high of the new week opening Gap you'd have the 50 based on the FIB midpoint consequent encroachment and then you can get the midpoint between the high and the 50 level to give you the upper third do the same thing down here between the 50 and low the lower quadrant so I like to use new week opening gaps that are split into quarters but I don't need to have the lines there"
NWOG Visual Structure
"So there's our two reference points and that is the basic new week opening Gap"
NWOG as Large Fund Fair Value
"The ICT new week opening Gap is a tool that I utilize to give me large fund fair value meaning that the markets will generally gyrate well a little bit higher time frame pulling back to old new week opening gaps"
"A real liquidity void is an absence of any buying and selling there's no printed data between two specific price points in this case we're focusing on the previous week's Friday close and the opening Sunday's opening price so if there's a difference between those two price points that Gap is a real liquidity void"
"That's a real liquidity void there's no trading there so when the market moves away from that Gap after repricing into it it can refer back to it weeks ago a month ago or more"
"Whereas everyone knows that there's gaps okay I didn't invent a gap on Sunday but the approach to utilizing and how the algorithms refer back to it as a point of fair value it's kind of like what an inefficiency is filled in and repriced to most Traders are familiar with it they're trained to think that okay it's over with now let's move on to the next thing that's not how the algorithms work the algorithms refer to old inefficiencies and old liquidity voids"
"Once it does that we don't ignore this Gap like most other individuals in technical analysis they're familiar with gaps gaps tend to be filled but once they're filled they're generally discarded and not me I hold on to these things because the algorithms is delivering price will refer back to these price points"
Opening and Closing Prices Are Not Random
"Opening prices are not random price events it means that wherever the first opening trade is the first tick of the marketplace when the new week opens at 6 PM New York local time that price is absolutely not random and the proof of that is to watch how price respects it throughout the week and in the future in weeks and months ahead in the future"
"Much in the same vein that opening prices are not random price events closing prices are not random"
"If you think about how the pivot numbers used to act and sometimes they'll do act as a magnet for price just like a draw on liquidity equal highs a single high when it's bullish price will invariably want to reach up above that old high for the buy stops or reach down below an old low or relatively equal lows for the sell stops so that draw on liquidity that same effect that magnetism on Price is seen with new week opening gaps"
Trending vs Consolidation Signatures
"Whenever there's a sudden move away like this that indicates that we are entering a trending Market"
"Range expansion or trending is when we leave the new week opening Gap and don't return back to it"
"When we're close to the new week opening Gap we're in range bound if it has a difficulty moving away he's coming back to it we're in consolidation"
"If price has a unwillingness to move away and just keeps coming right back to that current new week opening Gap then we're probably going to be range bound and consolidating so you have to be a scalper"
"If you think about when a market is indicating that it really wants to run away and Trend... you can see here this is that same week extended forward and then look at me down here we extend the amount of time inside that new week opening Gap and then aggressively runs lower whenever there's a sudden move away like this that indicates that we are entering a trending Market"
Multiple NWOGs = Consolidation
"Another characteristic of a consolidation market is when there's a multitude of new week opening gaps converging and within that range... when there is a convergence of multiple new week opening gaps in close proximity to one another the markets will tend to enter into this range-bounded environment"
How Many NWOGs to Keep on Your Chart
"I like to have a minimum of five weeks worth of it... you want to have at least four minimum four new week opening gaps on your chart for proper perspective of large fund Fair valuation"
"I like to have five because it keeps a kind of like a a dynamic four months perspective so it kind of gives you a little bit of an overlap not just the blanket four weeks look back"
"Whatever today is in trading I look back 60 days... whatever new week opening gaps have formed in the last 60 days that's how far I'll look back and that's the maximum I have on my charts"
"There's a concept that I teach the IPDA data range and it's the 60-day look back and the 60-day cast forward so whatever today is I look back 60 days"
New Day Opening Gap (NDOG)
"Just like we discovered in the new week opening Gap the new day opening gaps openings are not a random then either"
"There's a hour break in Futures Trading... the opening price is the very first tick or traded price that's not random"
"Here's the closing price of the previous session at 5 PM... one hour later we reopen in the Futures Market at 6 PM so that's our new day opening Gap"
"NDOG or New Day opening Gap forms every day Monday Tuesday Wednesday Thursday... we don't have it there [Friday to Sunday] because we have the new week opening Gap the difference between where we close on Friday and will be open on Sunday"
When NDOG May Not Form
"The new day opening Gap sometimes may not actually form there may be very little separation between where we close at 5 pm and where we resume opening a new trading session at 6 pm this pattern that forms with this new day opening app may not be an everyday event so if it's not showing a meaningful separation between the two price points I won't even utilize it"
"If it's like one tick or like two ticks you know I'm I'm not terribly excited about that it can respect it but I generally don't like to see those types of new day opening gaps I prefer to see a separation like this okay where it's much more meaningful you can see a real separation there isn't a specific number of handles or points that I like I just don't want it to be less than preferably it's got to be at least more than one handle"
NDOG Visual Structure
NDOG Duration of Relevance
"Carrying the data forward and casting it throughout the entire week once that week closes I'm not interested in that new day opening Gap so in other words this has been utilized last week I'm not interested in these two levels now going into a new trading week so in my opinion in my own my own analysis the new day opening Gap I'm only interested in for the week when the week ends and we start a new week I'm going to utilize the very first new day opening Gap and I'll extend that throughout the entirety of the week"
"Once it closes the gap that's not a point of abandoning the gap... we refer back to that area again in the future"
NDOG as Supporting Factor
"New day opening gaps I like to see them act as a supporting factor or a resistance to an idea that I have already arrived at with other PD arrays or other analysis Concepts so it's not blinddo it's not a Panacea it's just one of those things I like to add to"
"There's a Confluence between that old new day opening Gap low over here where it opens at 6 pm extending it forward what's also here a fair value Gap in the form of a buy side imbalanced sell side and efficiency so from here to here and dropping down that's optimal trade entry OTE it's a fair value Gap and it's also the time where it closes in that Gap with a retouch to that new day opening Gap below"
Practical Rules & Chart Management
"I like to have a chart template like this where I keep all my new week opening gaps for Nasdaq ES Dow dollar and for the Forex pairs I trade with euro dollar in pound dollar so it's real easy to manage"
"On Fridays as soon as the market closes or in the evening time just go and put a ray a little trend line here right on the closing price on Friday and then wait for Sunday's opening as soon as you get Sunday's opening tick that opening price dropper level measure the difference between Friday's closing price and Sunday's opening price gives you consequent encroachment level annotated and you're done you're ready real quick it's easy to update and manage and then save your template once it's done"
Price Behavior with NWOGs
"Price will many times gravitate back to it or a previous week or weeks old new week opening gaps so it's not just like we use this week's and it's we're done it's important to have that data on your chart and keep it as a template"
"So it's not just simply a matter of a fair value Gap but we use the new week opening gaps like fair value and you can see how we gyrate from one level to the next"
Halfway Point Rule
"If we have a new week opening Gap and it's likely to go higher between the two of them halfway point if price can reach that far probabilities are that it will probably reach through the next new week opening Gap in the series of the last several weeks and months of new week opening gaps that you would keep on your chart"
Homework Assignment
"Your homework assignment is to use the opening price on Monday at 9:30 for ES and use the Friday closing price at 4:59 that is another new week opening Gap you're not factoring in Sunday's trading at all"
"We have new week opening Gap actual where it's Friday Friday's close price to Sunday's opening price then we have new week opening Gap which is simply what Friday's closing price at 4:59 and 9:30 opening price on Monday"
"Having those two you're gonna have two templates now you're going to be able to see different new week opening gaps and how Fair valuation is utilized throughout the week and weeks and across a spectrum of at least a month or so"
Study Flashcards
Click each card to reveal the answer
Quick Reference
| Element | NWOG | NDOG |
|---|---|---|
| High Reference | Friday Close (4:59 PM EST) or Sunday Open (whichever higher) | 5 PM Close or 6 PM Open (whichever higher) |
| Low Reference | Friday Close or Sunday Open (whichever lower) | 5 PM Close or 6 PM Open (whichever lower) |
| Formation Frequency | Weekly (Friday to Sunday) | Daily (Mon-Thu only) |
| Duration of Relevance | 60 days lookback | Current week only |
| Minimum to Keep | 4-5 (up to 60 days) | Meaningful gaps for current week |
| Midpoint Name | Consequent Encroachment | Consequent Encroachment |