Review: What is a Gap?
Rating: 5 out of 5
Date: 04 17, 2014
Gaps are areas where the price of a stock moves sharply up or down, with little or no trading in between. As a result, the asset's chart shows a "gap" in the normal price pattern. With study and analysis an effective trader can recognize and take advantage these gaps for profit.  The high risk of Gap trading can even be minimized by good traders.  Young explains and gives a detailed diagram of each type of gap.  The four types of gaps are:• Continuation-price pattern is established• Breakaway-occurs at the end of a sideways trend and signals the beginning of a new one• Exhaustion-is at the end of a trend marking the start of a reversal of stock price• Common-occurs when normal trade is disruptedA very interesting and informative book from Young on gap trading strategies.