Understanding the nuances of Gaps such as Area Gap, Breakout Gap, Runaway Gap, Exhaustion Gap and how they indicate a trend’s strength

  • : A gap in technical analysis is when the days open with a gap up or gap down. This might not help in creating positions but can help to reveal the strength of the trend
  • : When a Gap appears in the common are of Buyers and sellers it is area Gap. When appeared beyond the trading range is called breakout gap. When appeared beyond the Breakout zone it is the Runaway Gap and the momentum is supposed to be higher because a lot of sellers turn into buyers to mitigate their loses. Exhaustion gap is when the market opens with a gapup and the gap gets filled this indicates the trend might no continue
  • : When any bad news or good news the market can open in gap down or gap up respectively. and if it opens in a gapup it shows some revelation of good news
  • : Appears in the common area. Should be filled in the near term. Volume should be less.
  • : Appears beyond the sellers region and high volume expected. and the gap appears beyond trading range.
  • : Appears above the Breakout zone and ideally should not get filled. also a short coverin rally can be expected because many selleres will close their position and buy back their stock to mitigate their loses
  • : When the market opens with a gap up but gets filled at the end of the day this shows that the Trend might not continue as strong and it has exhausted itself.
  • : Is runaway gap just a forward version of breakout gap

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