Sunday open spreads and the first thirty minutes

[Amanhasnoname]

The market reopens on Sunday evening, and the first minutes look nothing like a regular session. Spreads are wide, quotes jump, and there is often a gap compared to Friday's close.

For scalpers, this period is mostly a trap. Liquidity builds slowly as banks in Asia and New Zealand begin quoting, and until then a few orders can move price a lot.

Typical behavior includes a spread of 5 to 20 pips on majors for the first minute or two, narrowing gradually over the next half hour. The price may also revisit the Friday close in the first hour, filling or partially filling the gap.

There is a tempting idea that the gap fill is a free trade. Sometimes it is. Sometimes the gap widens, and a fill takes days.

If trading the open, size down heavily and use limit orders. Market orders into a thin book are the fastest way to give away money.

Does anyone actually trade the first thirty minutes of the week, and what rules keep it from turning into a mess?