iCharts Discussions

[ktpillai]

We see creation of gaps either up or down say in Nifty.Some gaps are filled on the same day of creation or after three days or after three years.First up all could anybody explain why gaps are formed? Next why certain gaps are filled on the same day?Why certain gaps are filled after an intervel?Likewise certain patterns either bullish or bearish fail.What is the reason for it?

[rk_a2003]

Gaps can be created due to extreme developments during market closure time. Like Lehman brothers Bankruptacy, A country Default,USA Down grade, UPA led by Congress winning with a clear majority in last general elections etc... etc... theese are huge gaps.


Small gaps can be created with a change in sentiment overnight. Why do some of them fill up on the same day some after few days some after few months...years


I add to it Why some of them will not be filled at all ?


There are fundamental as well as technical reasons for it. Each has to be discussed refering to it historical ,economical backgrounds on case by case basis.


Your question is too simple but answer is not.


However a discussion related to your question is going on in another thread "A Layman approch to break out and break down." .Please go through it.