Week Open/Week Close (WOWC) Gaps

Monday Morning Gaps: What 3+ Years of Data Says About When They Close

A study of 810 Friday-to-Monday gaps across US30, GER40, XAUUSD, EUR/USD, and USD/JPY

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The Setup: Strait of Hormuz, Sunday Night, and a Trader's Wrong Assumption

Over the weekend of April 11–12, 2026, news broke that the US Navy was preparing to blockade the Strait of Hormuz. By Monday morning, markets had opened with significant gaps — a sharp risk-off move of the kind that makes traders reach for their analysis notebooks. The DOW (US30) gapped down more than 500 points. The DAX (GER40) dropped over 340 points at the open. EUR/USD gapped aggressively; even USD/JPY — which gapped up as the dollar was initially bid — moved sharply.

My morning analysis led me to a classic assumption: a big gap like this will correct first, then continue in the direction of the gap. In other words — expect a partial retrace toward Friday's close, then resumption of the move.

Instead, every instrument simply filled the gap and kept going. No correction. No second wave. The gap was erased and price continued straight through Friday's close, leaving anyone positioned for a fill-and-bounce badly offside.

Was this unusual? Or was I wrong to expect otherwise?

I went back to the data.

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The Study: 3+ Years, 5 Instruments, 810 Gaps

Using MT4 hourly (H1) data from Pepperstone for five instruments — US30, GER40, XAUUSD, EUR/USD, and USD/JPY — I identified every Friday-close-to-Monday-open gap from mid-2022 through April 2026: roughly 180–200 trading weeks per instrument.

Definition: Friday's last H1 bar close vs Monday's first H1 bar open. Any non-zero difference is a gap.

Closure: The first subsequent H1 bar whose high (for a bear gap) or low (for a bull gap) trades back to the Friday close level.

Gap size: Expressed as a percentage of the 14-day Average Daily Range (ADR). This normalises for scale — 300 points means very different things on the DAX versus EUR/USD — and gives a measure of how meaningful a gap was relative to that instrument's typical daily movement.

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Finding 1: Gaps Almost Always Close

The first and most important result: weekly opening gaps are not permanent. Across all five instruments, the closure rate is remarkably consistent.

Instrument	Gaps	Closed	Same-Day (Mon)	Avg Days to Close
US30	190	98.9%	86.7%	1.36
GER40	141	97.9%	84.8%	2.29
XAUUSD	179	97.2%	87.4%	1.66
USD/JPY	199	99.5%	86.4%	0.82
EUR/USD	145	97.9%	90.8%	0.63

Roughly 85–91% of all gaps close on the same day they open — and nearly 97–99.5% close eventually.

The FX pairs close fastest, averaging well under one trading day. This makes structural sense: currency markets are essentially 24-hour and deeply liquid; when weekend news moves price, Monday's Asian and European sessions immediately begin resolving the imbalance. The indices carry more weight from the thin Sunday-opening period and take slightly longer — though GER40's higher average (2.29 days) and XAUUSD's (1.66 days) are both skewed by a handful of very persistent large-gap outliers.

"Waiting until Friday" — gaps that take until the end of the week — does happen, but it is genuinely uncommon: only 2–4% of gaps across all instruments took three or more trading days. You'd be waiting all week on less than one gap in twenty-five.

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Finding 2: Size Is the Critical Variable

The aggregate numbers look reassuring, but they conceal a sharp split. When each instrument's gaps are divided into quartiles by size relative to ADR, the same cliff-edge pattern appears across all five markets.

US30 (190 gaps — the most complete dataset):

Gap Size (% ADR)	Count	Same-Day Close	Avg Days to Close
Q1: 0–4%	47	98%	~0
Q2: 4–9%	49	94%	~0
Q3: 9–15%	44	93%	~0
Q4: 15%+	47	62%	5.3 days

Below roughly 15% of ADR, the default outcome is Monday closure: 88–100% of the time across all instruments. Cross into the top quartile — gaps above ~15–20% of ADR — and same-day closure drops to 62–74%, with average time-to-closure rising sharply, driven by a handful of outliers that can persist for weeks or months.

The Spearman correlation between gap size and days to close runs from r = 0.25 (USD/JPY) to r = 0.40 (US30) — real, but not dominant. The relationship is concentrated almost entirely in the top quartile. The bottom three quartiles might as well be identical: all close on Monday.

The practical upshot: gap size relative to ADR is the single most useful filter. A 3% ADR gap and a 12% ADR gap behave the same way. A 30% ADR gap is a different instrument entirely.

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Finding 3: Direction Matters — Especially in Trending Markets

A consistent asymmetry appears across all instruments that have been in a clear directional trend during this period:

Instrument	Bull Gap Avg Days	Bear Gap Avg Days	Ratio
GER40	3.36	0.63	5.3×
XAUUSD	3.34	0.52	6.4×
USD/JPY	1.84	0.52	3.5×
EUR/USD	0.72	0.59	~equal
US30	1.43	1.24	~equal

GER40, Gold, and USD/JPY all show the same pattern: gaps in the prevailing-trend direction close in under a day on average, while counter-trend gaps take 2–6× longer.

The GER40 and XAUUSD numbers are the starkest. Over this period — a broadly risk-off, equity-under-pressure, gold-in-a-bull-market environment — a bear gap on the DAX at the open finds ready buyers almost immediately. An unexpected bull gap opens against that pressure, and sellers take their time.

USD/JPY tells a similar story from a different angle. This period has been characterised by JPY strength (falling USD/JPY). Bear gaps — USD/JPY opening lower, in the direction of the yen strengthening trend — close in half a day on average. Bull gaps that open against that trend take 1.84 days on average.

EUR/USD and US30 show near-symmetry, consistent with a more balanced oscillating regime rather than a persistent one-directional trend.

The implication: before fading a gap, check which direction it is relative to the prevailing structure. In a trending instrument, fading a counter-trend gap carries meaningfully more time risk than fading a trend-aligned one.

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Finding 4: The Hormuz Gaps in Context

The gaps that opened on Monday April 13 were among the largest in the full dataset:

Instrument	Direction	Gap Size	% of ADR	Closed?
US30	Bear	510 pts	64.5%	Same day ✓
GER40	Bear	343 pts	52.2%	Same day ✓
XAUUSD	Bear	88 pts	50.7%	Same day ✓
EUR/USD	Bear	--	79.5%	Same day ✓
USD/JPY	Bull	0.35	39.2%	Same day ✓

All five sit firmly in the top quartile — the zone where same-day closure is only expected 62–74% of the time. Yet all five filled on Monday.

Note that USD/JPY gapped up (bull) on Hormuz day, while the risk assets gapped down. The dollar was initially bid — likely a combination of oil-price dynamics and flight-to-liquidity — before reversing intraday to fill the gap.

So was my expectation of "fill then continue in the direction of the gap" wrong?

From a probability standpoint, expecting closure was correct — even for Q4 gaps, 62–74% close on Monday. The failure was in the what happens after closure assumption. The data only measures when price returns to Friday's close level. Whether it then bounces and continues in the gap direction, or ploughs straight through (as happened on April 13), is not captured here. That is a question of trend context and market structure, not gap mechanics.

The Hormuz gaps opened into an already-deteriorating market with significant overhead supply. The news accelerated a move that was already in progress; once the initial panic was absorbed, the market found the gap level was not meaningful resistance, and continuation in the direction of filling was the path of least resistance.

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The Outliers: When Gaps Stay Open for Weeks

The 1–3% of gaps that remain open for extended periods share a clear characteristic: they are large events (top quartile by ADR %) that occurred with the prevailing trend rather than against it.

The US30's 113-day unclosed gap (October 2025, 124.7% ADR) landed in the middle of an impulsive downward move. Gold has a gap from April 6, 2026 — a bull gap of 136 points (67.1% ADR) — that remains open as of writing: gold gapped sharply higher as the initial tariff shock sent investors into safe-haven assets, and has never looked back far enough to fill it. USD/JPY's 65-day outlier coincided with a period of sustained yen strength.

A gap that opens with a Wave 3 or a sustained impulse behind it is not a gap the market is in any hurry to fill — it is the market making a statement. Contrast that with the Hormuz gaps, which were a geopolitical headline into a market that had already made up its mind. The news created the gap; the existing structure resolved it.

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Practical Takeaways

1. Below ~10% ADR: the probability edge is firmly with gap closure on Monday. 94–98% of the time across all instruments. This is where the "gaps always fill" maxim actually holds with statistical weight.

2. 10–20% ADR: still closes same day 88–96% of the time, but give yourself until mid-week. Don't force an exit on Monday if the level hasn't been reached.

3. Above 20% ADR: closure is still the eventual base case (97–99%), but abandon assumptions about timing. Check the trend. If the gap opened with a clear impulse, respect it. If it opened into a counter-trend move or thin weekend conditions, the odds still favour Monday closure — just not as strongly.

4. The direction asymmetry is actionable. In a trending market, fading a gap in the prevailing-trend direction has a dramatically tighter expected duration than fading a counter-trend gap. Bear gaps on the DAX in a bear market close in hours, not days. Allocate your patience accordingly.

5. Gap closure is not a signal — it is an event. The moment price touches Friday's close tells you the gap filled. It tells you nothing about what happens next. The April 13 trade was a perfect illustration: the gap filled, and price kept going. Closure is the starting gun for your then what? analysis, not the finish line.

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Data notes: Analysis performed on Pepperstone H1 MT4 history files. Data coverage: US30 and XAUUSD from June 2022; GER40, USD/JPY, and EUR/USD from mid-2022/2023; all to April 2026. XAUUSD recent gaps derived from M1 data resampled to H1. Gap size normalised against a 14-day rolling ADR with no look-ahead bias.

This blog post was produced with the help of AI.