GAP

GAP is to indicate strength. If the gaps are identified then it is easy to indicate if it is early stage of the trend or at the end of the trend.
There are four types of GAP.
Area GAP
Breakout GAP
Runaway GAP
Exhaustion GAP
If the price of a commodity is 10 and it goes to 20 by eod. Tomorrow morning if the starting price of the same commodity is 30, then there is a gap. This is nothing but trading range
Any GAP in the non trending area is Area GAP. Area Gap can be filled. Volume is generally low
This Gap will occur out of range. That is there will be significant increase in the starting price of the commodity compared to previous day’s closing price. Supported by high volume. This Gap will not be filled
Run away GAP appears in trending area and it goes out of range. Volume need not be high. Indicate buying
Starting price of the commodity is at very high level compared to previous day’s closing price but after that price goes down and the gap is filled before EOD. This is called terminating GAP