Breakaway Gap

AAA

DEFINITION of 'Breakaway Gap'

A term used in technical analysis. A breakaway gap represents a gap in the movement of a stock price supported by levels of high volume.

Breakaway Gap



The image shows a gap at the beginning of a large upward movement.

INVESTOPEDIA EXPLAINS 'Breakaway Gap'

If you chart it, the gap reflects a bullish movement when the price has gapped upwards and a bearish movement when the price has gapped downwards.

RELATED TERMS
  1. Production Gap

    An economic analytical term denoting the degree of relative deviation ...
  2. Gap

    A break between prices on a chart that occurs when the price ...
  3. Bear

    An investor who believes that a particular security or market ...
  4. Technical Analysis

    A method of evaluating securities by analyzing statistics generated ...
  5. Runaway Gap

    A type of gap on a price chart that occurs during strong bull ...
  6. Exhaustion Gap

    A gap that occurs after the rapid rise in a stock's price begins ...
RELATED FAQS
  1. How do I build a profitable strategy when spotting an Exhaustion Gap?

    An exhaustion gap offers a trader the opportunity to enter a sell position near the very top of a long uptrend and to quickly ... Read Full Answer >>
  2. How do I build a trading strategy after spotting a breakaway gap pattern?

    A breakaway gap is often seen after a company releases a big news announcement that earnings were much better than anticipated. ... Read Full Answer >>
  3. What's the difference between the coverage ratio and the levered free cash flow to ...

    Coverage ratios focus on a company’s ability to manage its debt, while the levered free cash flow to enterprise value ratio ... Read Full Answer >>
  4. How can I use market capitalization to evaluate a stock?

    Market capitalization represents the market value for an entire company. Investors can compare market cap to financial data ... Read Full Answer >>
  5. What are the advantages and disadvantages of using systematic sampling?

    As a statistical sampling method, systematic sampling is simpler and more straightforward than random sampling. It can also ... Read Full Answer >>
  6. How effective is creating trade entries after spotting a Tri-Star pattern?

    The tri-star patterns, both bullish and bearish, are about as rare as they are unreliable. Comprised of three consecutive ... Read Full Answer >>
Related Articles
  1. Forex Education

    Playing The Gap

    Learn how you can earn money by analyzing the disruptions in normal price patterns.
  2. Trading Strategies

    Find Turning Points With Single-Day Patterns

    On their own, single-day patterns can be unreliable, but that doesn't mean they can't be used effectively.
  3. Fundamental Analysis

    What is Quantitative Analysis?

    Quantitative analysis refers to the use of mathematical computations to analyze markets and investments.
  4. Chart Advisor

    Invest in Japan with this ETF

    The Japanese stock market has been front and center in the minds of many international traders over the past few weeks — and for good reason.
  5. Charts & Patterns

    How to Analyze Pharma Stock Fundamentals

    What you need to know about analyzing the fundamentals of pharma stocks.
  6. Chart Advisor

    Bullish Traders Are Turning To Rare Earth Metals

    Companies that explore and or process rare metals are of specific interest to traders because of strong moves in a couple of the sector’s key players.
  7. Chart Advisor

    Long and Short Trades to Consider This Week

    Here are short and long trades to consider, so you have choices no matter which way the market goes.
  8. Trading Strategies

    How To Best Analyze Relative Strength

    Relative strength indicators measure performance between similar instruments, uncovering opportunities that can translate into reliable profits.
  9. Technical Indicators

    A Guide To Finding The Most Actively Traded Stocks

    Knowing the trading volume of a stock helps traders understand price movements and forecast future movements. This short guide helps investors locate actively traded data.
  10. Charts & Patterns

    Why These May Be the Top 4 Growth Stocks of 2015

    These four stocks have high upside potential in 2015.

You May Also Like

Hot Definitions
  1. Expected Return

    The amount one would anticipate receiving on an investment that has various known or expected rates of return. For example, ...
  2. Carrying Value

    An accounting measure of value, where the value of an asset or a company is based on the figures in the company's balance ...
  3. Capital Account

    A national account that shows the net change in asset ownership for a nation. The capital account is the net result of public ...
  4. Brand Equity

    The value premium that a company realizes from a product with a recognizable name as compared to its generic equivalent. ...
  5. Adverse Selection

    1. The tendency of those in dangerous jobs or high risk lifestyles to get life insurance. 2. A situation where sellers have ...
Trading Center