What is a Gap ?


A gap is a chart pattern that consists of two adjacent Candlestisck, where the low of one candlestick is higher than the high of the other Candle.
A Gap is an area on a price chart in which there were no trades. Normally this occurs between the close of the market on one day and the next day's open. Gaps occur when the lowest price traded is above the high of the previous day or, conversely, when the highest price traded is below the previous day?s low.
Gaps appear more frequently on daily charts, where every day is an opportunity to create an opening gap. Gaps on weekly or monthly charts are fairly rare: the gap would have to occur between Friday's close and Monday's open for weekly charts and between the last day of the month's close and the first day of the next month's for the monthly charts. Gaps can be subdivided into four basic categories: Common, Breakaway, Runaway, and Exhaustion.