A Technical Approach To Trend Analysis: Practical Trade Timing for Enhanced Profits

Runaway Gaps

Another form of gap is the runaway gap, also called the measuring gap. This is normally found during trending movement, often as part of a secondary trend working against a primary trend. When runaway gaps appear, it might indicate a short-term move in the indicated direction, which is likely to revert to the previous or primary trend direction.

Key Point

A runaway gap might be part of a strong and evolving trend, often found in a secondary trend of great momentum but short duration.

Another type of runaway gap occurs right after price makes a move and is supported by the strong gapping action, providing confirmation of a continuation in the new trend. In other words, runaway gaps can mean many different things and should be ...