What is a Gap?

A Gap is when the price of a financial asset opens sharply above or below the previous day’s close with no trading activity in between. The terms ‘gap up’ and ‘gap down’ refer to the direction of the price movement. A ‘gap up’ is when the opening price is higher than the previous day’s close […]

Filled & Fading: What Does This Mean?

When a gap is filled, it means the price has returned to the original level before the gap happened. This usually means the price of the asset, in the following days or weeks, retraces to the last price before the gap occurred. As breakaway and continuation gaps confirm a trend direction, it is less likely […]

Different Types of Gaps

There are four other main types of Gaps. Common Gaps – occur independent of fundamental and technical factors and as the name suggests, are very common. Common gaps are usually accompanied by low volume as there is no major event that precedes the gap. This type of gap is filled quickly and provides few trading […]

The 80 – 90 Strategy

A mean reversion trading idea / strategy that capitalises of the 15% gap statistic. According to…