Runaway Gap

AAA

DEFINITION of 'Runaway Gap'

A type of gap on a price chart that occurs during strong bull or bear movements characterized by an abrupt change in price and appearing over a range of prices. They are best decribed as gaps caused by an sudden increase/decrease in interest for a stock.

Runaway Gap



The image shows a gap in the middle of a large upward movement.

INVESTOPEDIA EXPLAINS 'Runaway Gap'

Sudden price changes are expected during strong bull and bear markets. However, most analysts view these gaps as temporary, expecting prices to converge upon the range in which the gap occurred in order to fill the missing segments.

RELATED TERMS
  1. Gap

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

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

    A method of evaluating securities by analyzing statistics generated ...
  4. Bull

    An investor who thinks the market, a specific security or an ...
  5. Exhaustion Gap

    A gap that occurs after the rapid rise in a stock's price begins ...
  6. Breakaway Gap

    A term used in technical analysis. A breakaway gap represents ...
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. Options & Futures

    Do stop or limit orders protect you against gaps in a stock's price?

    Many individuals are hesitant to invest in the stock market because of the large gaps in prices talked about in the news. It is not totally uncommon to see a stock that closed the previous session ...
  4. Investing

    Does a stock split lead to the gapping up/down of the stock?

    If a company splits its stock, there will be no gapping of the stock due to the split itself. A stock split does not materially affect a company's value and will not lead to the wide changes ...
  5. Trading Strategies

    Risk Management Techniques For Shorting Call Options

    Shorting covered calls is a popular options trade strategy. Here are the methods to mitigate the risk/loss and enhance profits for selling covered calls
  6. Chart Advisor

    Use This ETF To Trade The Swiss Franc

    Traders were stunned last week when the Swiss National Bank removed the currency peg that tied the value of the Swiss franc to the euro.
  7. Trading Strategies

    Day's First Trade Can Serve As Support/Resistance

    The first trade of the day in liquid markets defines a narrow price level that can act as support or resistance for the entire session.
  8. Chart Advisor

    3 Energy Related Stocks Poised For A Pop

    A sharp decline in energy prices have created an interested opportunity in several oil-and-gas related companies. Given the strong downtrends apparent on the charts, most traders would use recent ...
  9. Chart Advisor

    Do Good Buys Remain Among Beaten-Down Financials?

    The financial sector performed the worst last month (besides energy, of course). Here's a look at some financial stocks that have bucked that trend.
  10. Trading Strategies

    How effective is creating trade entries after spotting a Sanku (Three Gaps) Pattern?

    Learn about the sanku, or three gaps, pattern including formation, interpretation and additional confirmation necessary to establish effective trades.

You May Also Like

Hot Definitions
  1. Commercial Paper

    An unsecured, short-term debt instrument issued by a corporation, typically for the financing of accounts receivable, inventories ...
  2. Federal Funds Rate

    The interest rate at which a depository institution lends funds maintained at the Federal Reserve to another depository institution ...
  3. Fixed Asset

    A long-term tangible piece of property that a firm owns and uses in the production of its income and is not expected to be ...
  4. Break-Even Analysis

    An analysis to determine the point at which revenue received equals the costs associated with receiving the revenue. Break-even ...
  5. Key Performance Indicators - KPI

    A set of quantifiable measures that a company or industry uses to gauge or compare performance in terms of meeting their ...
  6. Bank Guarantee

    A guarantee from a lending institution ensuring that the liabilities of a debtor will be met. In other words, if the debtor ...
Trading Center