Home > Boards > Free Zone > Penny Trading - Technical > Triple 000 and Sub-penny Chart Plays

Educational Post: "Trading Gaps"

Public Reply | Private Reply | Keep | Last ReadPost New MsgReplies (4) | Next 10 | Previous | Next
trader53 Member Profile
Member Level 
Followed By 5,920
Posts 209,819
Boards Moderated 8
Alias Born 06/04/09
160x600 placeholder
Reata Pharmaceuticals Down 30% After Hours on FDA Advisory Panel Vote
By Josh Beckerman
Correction to FTSE 100 Index Ends Flat at 7337.05 -- Data Talk
Reata Pharmaceuticals Gets Negative Vote From FDA Advisory Panel on Bardoxolone Methyl
Top Company News of the Day
Wheat Falls as Traders Anticipate World Supply Growth -- Daily Grain Highlights
Front Month Nymex Natural Gas Rose 2.89% to Settle at $3.8150 -- Data Talk
Front Month Nymex RBOB Gasoline Rose 2.31% to Settle at $2.1485 -- Data Talk
Kraft Heinz to Create North America Zone from Canada, U.S. Businesses Merger
U.S. Grain, Soybean Weekly Export Sales Estimates for Dec. 2
FTSE 100 Closes Down as New UK Covid-19 Restrictions Loom
STOXX Europe 600 Index Ends 0.59% Lower at 477.36 -- Data Talk
CAC 40 Index Ends 0.72% Lower at 7014.57 -- Data Talk
DAX Ends 0.80% Lower at 15687.09 -- Data Talk
FTSE 100 Index Ends Flat at 7337.35 -- Data Talk
EURO STOXX 50 Index Ends 1.01% Lower at 4233.09 -- Data Talk
STOXX Europe 50 Index Ends 0.59% Lower at 3726.78 -- Data Talk
CP Rail Shareholders Approve Stock Issuance as Part of Kansas City Southern Deal
U.S. Ethanol Production Surges
U.S. Oil Inventories Edge Lower, Fuel Supplies Surge
NXP Semiconductors Down Over 5%, on Pace for Largest Percent Decrease Since June 2020 -- Data Talk
Slovakia's Gross Funding Needs to Amount to EUR6 Billion in 2022; 1-2 New Government Bonds Expected
Consumer Prices on Deck -- Data Week Ahead
Correction to Blackstone Buys Shares From James Article
Philips Gets FDA Clearance to Expand Patient Monitors Across U.S.
Warren Calls for Full Disclosure of Trading by Fed Governors; WSJ Survey Finds Inflation a Pressing Concern for U.S. Voters
U.S. Crude-Oil Stockpiles Likely Decreased in DOE Data, Analysts Say
trader53 Member Level  Monday, 06/04/12 04:03:40 AM
Re: trader53 post# 1184
Post # of 233264 
Educational Post: "Trading Gaps"

MOST all "Gaps" fill.
They are caused by "retail emotion",
and when emotion leaves,
the long share holders,
bring the stock price back to a reasonable,
average new price level.

"Gaps" don't need to fill.
They normally do!

90% of all "Gaps" fill !

"Emotion" causes the "Gaps" in price!

If you see a "Gap",
expect the price to come back and correct the emotion!

When some news event, or, manipulation happens,
the price swings to extreme,
leaving "gaps" in the price,
from the previous day close,
to the next mornings open.

A "Gap" is seen,
when the day before's close price,
is lower then the next mornings open price,
or vice versa.

There are 4 types of gaps:
> Common Gaps
> Breakaway Gaps
> Runaway Gaps
> Exhaustion Gaps

Common Gaps are always closed.
They occur with a one day pop, usually,
and the lack of a second day continuation,
shows why they fill!
There is NO real emotion.

Breakaway Gaps are usually closed over time.
You see them in a multiday emotion run,
or walkdown,
where the stock price is trending around,
over several months.
The retail mindset returns to logic,
and fills the gap with the retrace.

Runaway Gaps are often the "few" that don't fill.
They take months, to a year, or more,
and should NOT be played.
You don't look back that far,
to see the gap fill at all!
Basically every thing just continues, lower!

Exhaustion Gaps are rarely seen.
They happen at the end of a move,
and show that the retail mindset
has reached an "enough is enough" point.
Everyone just gives up.


Example: SUGO

In January and February,
you will notice 3 - "Gaps".
> 0.001
> 0.0007
> 0.0005

ALL of the gaps got filled !!







Public Reply | Private Reply | Keep | Last ReadPost New MsgReplies (4) | Next 10 | Previous | Next
Follow Board Follow Board Keyboard Shortcuts Report TOS Violation
X
Current Price
Change
Volume
Detailed Quote - Discussion Board
Intraday Chart
+/- to Watchlist
Consent Preferences