In the world of stock market charts, a gap is like a surprising break—a sudden jump or drop in price from the previous day's close, with no trading happening in between.
WHAT IS GAP UPORGAP DOWN
A gap up occurs when the current day's opening price is higher than the previous day's closing price. This sudden jump often indicates bullish momentum, with investors eager to buy at higher prices.
a gap down occurs when the current day's opening price is lower than the previous day's closing price. This abrupt decline typically reflects bearish sentiment, as investors rush to sell at lower prices.
There are mainly four types of gaps-1) Common Gaps2) Runaway Gaps3) Breakaway gaps4) Exhaustion Gaps