GAP means price gap in Forex. In the money markets, transactions are not made for some periods and as a result of these, disconnections occur on the charts. These breakouts are called price gaps. Gaps can be in the direction of uptrend and downtrend. It is more common in stock markets.
You can come across a price gap in Forex over the weekend. As the Forex market does not work on the weekend, events pile up and cause price breakouts. Even if your position is not open, it will be beneficial for you to follow the domestic and international markets. The trading volume of the market and the factors affecting the direction of the prices can cause a gap to form. The priority issues that cause this are political developments and economic developments. To make a profit in the Forex market, you should always be able to follow the market.
Types of Forex GAP Price Gap
The price breakouts seen in the charts do not occur due to a single reason. In order to understand the graph, you must first know these types. Following the market will give you an idea. Examining the market price movements will allow you to make a more accurate interpretation.
GAP Standard Gaps
These gaps, which are not important for price targets, are seen as insignificant. For this reason, they are not taken into account. If the transaction volume decreases, these gaps can be observed. If standard gaps become too large, it indicates that the economy is progressing negatively. In this situation, it will be important to stay calm and follow the market. In this way, you can make positive use of standard blanks.
GAP Break Gaps
Breakout gaps allow investors to have a preliminary idea of the market. When these gaps are seen, compressions are seen between the declines and rises. Resistance and support policies kick in and price correction policy begins. While this situation continues, sharp ups and downs can be seen.
GAP Ongoing Gaps
It is a continuation of break spaces. These gaps can be in the direction of rising and falling. Most of the investors trade in the direction of selling. This situation can reduce confidence in the market.
GAP Depletion Gaps
It is the most important type of price gap. These gaps are seen in the trading volume between the closing of the previous day and the opening of the new day. This gap is directly proportional to the trend. When the trend ends, the ups come to an end. Near the end of the trend, incoming demand results in supply.
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