Gap
Also called: gap up, gap down
An empty space on the chart where price opens sharply higher or lower than the prior close, usually driven by news or a catalyst.
A gap up opens above yesterday's high; a gap down opens below yesterday's low. Gaps reflect a sudden shift in supply and demand overnight — earnings, guidance, an upgrade, sector news.
Traders classify gaps by behaviour: a 'gap and go' keeps running in the gap's direction, while many gaps 'fill' as price retraces to close the empty space. A gap that holds above the prior high on volume can kick off a strong trend.
On StockSetups
StockSetups' real-time engine fires gap and gap-and-go alerts at the open, and the daily scan carries each name's gap percentage — paired with the 'why it's moving' catalyst so you know what drove the gap.
Related terms
See gap on tonight's board.
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