Gap Trading
How PipFarm handles profit from price gaps larger than 0.2%
Gap trading refers to opening or holding positions that profit from sudden and significant price jumps, known as gaps. A gap occurs when the next available price is significantly higher or lower than the last traded price, without passing through the intervening levels.
While price gaps can happen unpredictably, they also occur at predictable times — such as at market open after a weekend or during high-impact news events. Some traders deliberately target these opportunities, which exploit the simulated trading model.
⚠️ This is a soft breach. You will not be disqualified for encountering a price gap, but profit gained from the gap will be deducted.
ℹ️ This rule applies to both challenge and simulated funded accounts.
What is a price gap?
A price gap occurs when the market moves from one price level to another without trading through the prices in between. On a chart, this looks like a sudden jump or drop where candles don't connect smoothly — there is a visible gap between the closing price of one period and the opening price of the next.
The image below shows the gold price jumping from $3,388.48 to $3,392.94, representing a 0.13% gap.
Price gaps can happen:
At the opening of a new session (e.g. after a weekend or daily close)
During high volatility, when the price skips levels due to a lack of liquidity
After unexpected news or headlines
At any time, not just during scheduled events
The gap rule
If your position profits from a gap that is larger than 0.2%, PipFarm will deduct the profit attributable to the gap. Profit earned before or after the gap is not affected.
Example 1 — Weekend gap
Suppose you buy 1 lot of XAU/USD at $3,495 on Friday morning. The market closes Friday at $3,500, giving you $500 in unrealised gains. On Monday, the market reopens at $3,517.50 — a 0.5% gap. You close the position at $3,520.
Example 2 — Intraday gap
You buy 1 BTC/USD at $95,000 on Monday at 09:00 with a take profit at $95,500. By 10:00, the price has gradually risen to $95,200. A sudden gap then occurs — the price jumps from $95,200 to $96,000 (a 0.84% gap), triggering your take profit.
Why this rule exists
This policy protects PipFarm from potentially unlimited losses in a simulated trading environment. You have a 0.2% allowance to benefit from price gaps. Any advantage gained from gaps larger than 0.2% will be deducted.