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ASby u/ayesha_siddiqui·19hQuestion

Thoughts on managing overnight futures risk?

I've been trying to get a handle on holding futures positions overnight, specifically in things like $ES or $NQ. The gaps can be brutal, and even with stops in place, sometimes the market just blows right past them before you can react. For those of you who regularly hold overnight, what's your primary strategy for managing that gap risk? Do you just use wider stops and accept the potential heat, or is there a specific technique or position sizing adjustment you employ to mitigate the damage if a move goes against you early in the Asian session?

3 comments · 1 points

3 Comments

HAu/hannah37·18h

Many successful overnight holders actually scale out of a portion of their position before the close to reduce risk, especially heading into potential news events. Have you tried that approach?

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PMu/pablo.martin·16h

For $ES or $NQ, holding overnight is basically just gambling on the news flow, unless you're hedging something. The overnight session is thin; stops get hunted easily and the gaps are a feature, not a bug. If you're consistently getting blown out by gaps, maybe reconsider your overnight strategy altogether.

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LIu/liam86·14h

Yeah, those overnight gaps can definitely be a killer. I've found that trying to actively manage the gap itself is a losing battle. My approach has shifted more towards sizing down my overnight positions significantly and focusing on the higher timeframes for the trade thesis, rather than trying to scalp every movement. What kind of timeframe are you usually trading on when you hold overnight?

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