A "gap down" is when a stock opens substantially lower than its previous
close, and many traders have learned to exploit this fact by jumping on board,
after this gap, and ride it back up. More often than not, a gapping-down stock
will "fill the gap" by bouncing sharply off its opening low, making its way back
to the flat line.
However, gap trading can be tricky, because not all gaps are created equal.
Such things as market conditions, related news, and earnings can greatly affect
the correct decision to make for playing the gap.
This video shows how to spot an "AM gap down" instantly using the scanners
in StockVision.
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