What is called as GAP in technical analysis?

[EQSIS Keymaster]

What is called as GAP in technical analysis?

[Abirami Duraisamy Participant Rank: Level 5]

GAP is the difference in the trading range, which can be seen using candlesticks charts. The chart will indicate a GAP in the candlestick view. GAP indicates the strength of the trend and helps to locate whether the trend is at early stage, breakout stage or at terminating stage.

[Pradeep Participant Rank: Level 4]

In a technical analysis chart, a gap represents an area where no trading takes place. It is is essentially an empty space between one trading period and the previous trading period.

The GAP is formed when there is a large-enough difference in the opening price of a trading period where that price and the subsequent price moves do not fall within the range of the previous trading period.

[V.VEDANAYAGAM Participant Rank: Level 5]

WHEN the day RANGE of a stock related to any TWO adjacent days does NOT over lap then GAP is said to be formed

Technically
(a) IF the TOP of the FIRST DAY candle is BELOW the BOTTOM of the NEXT DAY candle

OR

(b)IF the BOTTOM of the FIRST DAY candle is ABOVE the TOP of the NEXT DAY candle
then it is called GAP

[bhavani Participant Rank: Level 7]

The difference in the trading range is called as a gap in technical analysis.

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