Category: Money tips Release Date: 2007-03-05
1. Patterns of gap refers to the share price in the fast there is a drastic change in the price of any transaction, showing trends in the stock price is a vacuum region, the region termed "gap", which is usually also known as gapped. When the stock price gap, after a few days or even longer, change, and then reversed back to the original, when the price gap, known as the gap closed. Also known as fill space.
Gap sub-normal gap, breaking the gap, persistent gaps and consumption of four types of gaps. The site took place from the gap size, can predict the strength of the trend, confirming that a breakthrough, or has reached the end of the trend, it is most powerful when analyzing all types of supporting materials. Hereby described below.
(1) Ordinary type of gap gap usually appears in intensive trading area, many take longer to organize the formation of patterns such as triangles or switch, rectangular and so there may be the formation of such gaps.
(2) break break gap gap is when a dense pattern of reversal or finishing after a breakthrough disc Bureau generated when the gap. When the stock with a large gap when gapped away from the pattern, which means that a real breakthrough has been formed. Because the wrong move will have very little gap, while the gap can show a strong breakthrough in nature, breaking the larger the gap, indicating a strong change in the future.
(3) The persistent gap in a gap up or down on the way, may be continuous gap. This gap will not break through the gap confusion, any type, or leave the region after the transaction-intensive rapid rise or fall in the gap arising mostly continuous gap. This gap can help us estimate the future volatility of the market outlook range, it is also called the measure of the gap.
(4) expendable and persistence gaps the gap like expendable gap is accompanied by fast, substantial stock price volatility appear. In the rapid rise or fall in stock price volatility is not a fade-resistance, but more and more urgent. Then the price jumped (or hop-bit down) may occur, this gap is the gap expendable.
Most of the gap is usually expendable or consumed in the panic selling of the last paragraph of an increase there.
2. Market, meaning (1), no particular gaps in the analysis of ordinary meaning, usually in a few trading days will be completely filled, it can only help us to identify clearly a pattern formation. General pattern of gaps in the order than in reverse pattern occurs when the opportunity is much greater, so when found in the development of the triangle and rectangle there are many gaps, it should enhance the belief that it is the order type.
(2) The larger significance of a breakthrough analysis of the gap, often in the important shift patterns such as head and shoulder type of breakthrough occurs, this gap can help us to identify the authenticity of break signal. If the price support line or resistance line break after a big gap jumped off the forms, we can see a breakthrough very strong, very few errors. Gap formation of a breakthrough because of its resistance to the level of contention over time after the power supply was completely absorbed, a short time, the lack of supply, investors are forced to buy more expensive goods demand. Or their level of support after a period of time after the supply of purchasing power was completely consumed, the need to sell more low-cost to find a buyer, thus the formation of the gap.
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If the gap occurs in front of a large trading volume, while the gap is relatively after the occurrence of reduction in volume, there may soon half of the gap will be closed, if after the occurrence of the gap with the stock trading volume is not far from the gap is reduced, but increased in the immediate future the gap will not be closed.
(3) The continuing significance of the largest gaps in technical analysis, it is usually the stock break away from the pattern to the next one after the reversal or the emergence of order patterns, so the forecast continued price gap can be about a possible future move distance, So, also known as the measure of the gap. its measured approach is to start from the breakthrough point, to the persistent gap in the vertical distance from a starting point, is the future stock price will reach the range. Or we can say: the future stock price to go the distance, and in the past have been walking the same distance.
(4) the emergence of expendable gap that the trend of stock prices will be temporarily come to an end. If the rise on the way, it means that soon will fall; if the decline occurs, it means you will soon rebound. However, the consumption of the gap does not mean that market conditions will turn out the insect, despite the shift means that there is a possibility.
In the gap that occurred the same day or the day after the turnover, if particularly large, and the trend over the future does not appear to pay a substantial volume of changes, which may be expendable gap ah, if the gap appears in the day after closing at stop In the gap of the edge of the day Quote of the reversal, the more expendable to determine this is a gap.
Expendable gap is rarely break the previous pattern of significant changes in the process of the first gap, the majority of cases in front of it continuing at least reproduction of a gap so you can assume that in the fast straight up or down movements emerged in the mid The first gap is continuing gap, but then every one gap is likely to be expendable gap, especially when the gap distance than the previous one large space, they should pay particular attention to.
Gap is the share price continued to produce substantial changes in the middle, and thus will not be closed in a short time, but expendable gap is about to reach the end of the final changes in the phenomenon, so mostly in 2-5 days of short-term closure.
3. Points to Note (1) General gap will be filled. Because the gap was a vacuum there was no transaction region, reflecting the investors at that time of the impulsive behavior, when the investment sentiment calmed down, investors reflect on the past behavior too far, so the gap will be warned that back. In fact, not all types of gaps will be filled, including a breakthrough gap, sustainability may not be to fill the gap will not be immediately filled; only expendable gap and the general gap in the short term it possible to pay back, so to fill the gap in the analysis of whether or not those who observe the afternoon is negligible.
(2) the emergence of a breakthrough gap will be filled immediately? We can observe the changes in trading volume out. If the cis-break before the appearance of a large number of closing the gap, but the gap appears reduced turnover, then immediately listen to the opportunity to fill the gap ratio is only 55; but if the gap closing after the formation of a significant increase in stock prices continued to move away from the pattern remained when the a very large number of transactions, then the gap could be filled in the short-term very low. Even if the pump appears also in the outside gap.
(3), when the share price break its regional rapid rise in trading volume in the initial volume, and then rose continuously reduced, when the stock price to stop the trend of the original contract, he also rapidly increasing, this is a good light the results of the two sides heated contention, which After the overwhelming victory of one side, so they form a huge gap, this time again beginning to drop. This is the continuous turnover of gap formation has varied.
(4) expendable gap is usually the formation of the gap with the highest turnover of the day (but it may be possible with the highest turnover occurred the next day), followed by reduction in turnover, an indication of purchasing power (or the selling power) was already depleted, so stock soon will come down (or pick-up).
(5) In the course of an up or down, the gap appears more to show the trend more quickly near the end. For example, when l gap appeared in the city, when a third, suggesting that l city soon came to an end; as the fourth gap occurs, the possibility of short-term drop is more intense.
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