SPY Fibonacci Price Theory And BreakOut BarsThis instructional video teaches you the basics of Fibonacci Price Theory in conjunction with Breakout Bars and how price is the ultimate indicator.
Throughout this video, I try to provide instruction on key elements related to the Fibonacci Price Theory (Unique & Standout Highs/Lows). Additionally, I've also included Breakout Bars and Fibonacci Price Retracement concepts.
What I really hope you learn from this video is to see price as the true ultimate indicator for your trading decisions. Using technical analysis techniques is fine, but use price as the key element when trying to confirm or reject your trading ideas.
I hope this helps you understand that price, action, and reaction through trends, peaks, and troughs are the most important components of the chart. Everything else is peripheral.
Breakaway
Types of Gaps !!!👨🏫Hello👨🏻🏫, dear traders from all over the world🗺️.
I'm Pejman🙋🏻♂️ & welcome🌸 to one more educational adventure🧭 in Tradingview, but we will not be traders💹 today; We want to look at our charts like a hunter🏹.
We look for every clue🐾 we see so that we can hunt suitable positions💱 like valuable creatures💰 and transfer them to the cages as our accounts💳 or wallets💸.
Although I'm not too fond🙍🏻♂️ of hunting, either legally or illegally.
But I know that hunting good positions in the forests🏞️🌳 of Tradingview is not prohibited😉❗.
So let's get acquainted with these clues🔎 as soon as possible because the price is skittish🙈, and we don't want to waste the hunting time⏳✅.
I said that in Technical Analysis , we look for ways to trade by using the price information, which is recorded on the charts📈. (such as the prey's tracks🔎🐾)
Today I want to introduce one of these clues so that you can become a professional position hunter🏹 by identifying the clues👀;
But don't forget that you should practice🙌🏻, be careful⚠️, and watch your positions👀, so you don't miss them or rush 🏎️💨to the wrong❌ position🙂.
Today's clue is the GAPS . First, let's see what the GAP is🤔.
The gap is nothing. I mean, it is something that is nothing😶🙄.
It is incredibly paradoxical💥! I'm kidding😉, but the space between candles🕯️ or bars is called a GAP.
A gap is created when we see👀 a price gap between two candles🕯️ or bars when the trading volume is high⏫ or low⏬. This difference or space between two candles is called a gap🤏🏻.
It is said that gaps are more valuable✅ in higher time frames among the traders, so much coin, much care👀.
Gaps, or as the Japanese🎌 term "windows," are significant for hunting🏹 positions, so as hunter traders, we should learn these gaps well👌🏻.
The reason🧐 for creating gaps can be factors such as important positive🆒 or negative🙈 news or an increase🔺 or decrease🔻 in supply and demand.
It is interesting to know that gaps are primarily seen in Forex , Stocks , and Commodities (especially when markets close and open).
The space👌🏻 between the candles means that the price has jumped like a rabbit🐰 from one number to the upper☝🏻 different number.
Or, like a monkey🐒, it moved from one number to a lower👇🏻 number.
I tried to make it funny😊 and straightforward👌🏻, but these gaps that move up or down have different types, like the year's seasons🌈☁️.
We have 4️⃣ seasons in a year and also 4️⃣ types of gaps in the charts.
According to personal taste😊, I relate the gaps to the year's seasons and, simultaneously, do not forget the case of hunting positions🏹💰.
So fasten your seat belts💺 because we want to travel in time🧳⏳ to all the year's seasons with this post🚩 and learn about the different price gaps, which are one of our clues🐾 to trap positions🪤.
Let's start with the autumn🍂 season because we are still in it and can understand it better😌.
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The name of this type of Exhaustion 🥱 gap.
They are seen at the end🔚 of a process, which means that the process may change🔄 at any moment.
Just like the autumn🍁 season, it may rain☔ anytime after seeing the clouds🌥️.
Another feature of this gap is the increase🆙 in trading volume, so by paying attention👀 to these points and practicing by reviewing the charts📈, you can easily recognize🔎 this gap.
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The next💁🏻♂️ gap is the Breakaway 🏃🏻♂️ gap.
The breakaway gap is associated with an increase⤴️ in trading volume.
This gap occurs when a critical range is broken🤞🏻, representing a strong💪🏻 start🏁 trend or a sign of trend change.
Like the blooming🏵️ of some trees🌳 in winter☃️ or the sprouting🌱 of plants from under the snow❄️.
Also, This gap is created when the price starts moving from a limited area, like support or resistance ( I'm going to talk about them in the future😉. )
I have to say that the breakaway gap plays a critical👌🏻 role in some of the classic reversal patterns, such as the Head and Shoulders Pattern , Double Top/Bottom Patterns , etc.
When The breakaway gap is combined with Classic Reversal Patterns, the breakaway gap adds to these patterns' validity✅.
If you want to get acquainted with the most important Classic Reversal Patterns of Technical Analysis , I suggest you read the following post👇.
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Now it's time for spring🌸🍀, and I'm going to introduce a gap like spring.
Spring season is a sign✌🏻 of the continuation of life💐, and this gap in technical analysis shows the continuation of a trend📈.
The Continuation gap is also known as a Runaway 🏃🏻♂️ gap, occurring in the middle of a downward↙️ or upward↗️ trend.
This type of gap creates a kind of confidence for traders to enter.
It doesn't occur when the price fluctuates or corrects in a limited area but occurs during a rapid increase or decrease.
So, as a result ☑️, if this gap occurs in an upward trend🔺, it indicates the continuation of the upward movement.
And when it is created in a downward trend🔻, it indicates the entry of more sellers and further price decline.
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Now we have reached✌🏻 the last gap🥰.
This gap is Common , but I should introduce it as the summer☀️ season.
These gaps are very common, And considering the time frame it has, it is expected to fill quickly, which is also called "closing the gap."
The filling or closing of the gap means that the price returns🔁 to the same area where the gap was created, like a criminal returning to the crime scene😄.
This can be true✅ for gaps as well.
Time flies in summer🏝️, and Common and Exhaustion 🥱gaps fill as soon as a blink👁️.
You may have heard👂🏻 that gaps are always filled, but this is not permanent🙅🏻♂️ and only a strong possibility🤏🏻.
For example, Continuation 🏃🏻♂️ & Breakaway gaps usually take a long time⌛ to fill.
But what if the gap doesn't close🤷🏻♂️?
Go to any currency pair and examine👀 the recorded data🗄️; You will find that many gaps take a year or more to close.
It is interesting😃 to know that the Japanese🎌 have another interpretation of the price gap.
They use gaps as continuation and reversal trading patterns (as I said, I'll explain them in future posts🔜😉).
It is interesting to know that the combination of gaps can create the Island reversal pattern.
The Island pattern consists of two gaps ; One up⬆️ and one down⬇️.
We will definitely✅ learn more about these patterns in the following posts🔜, but today we are only focusing on the gaps🧐.
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Another thing I want to add➕ is about the Heikin-Ashi charts💹 that we learned about in the previous post🔙.
Gaps are filtered❌ in Heikin-Ashi charts.
As I said, in this chart, the average is displayed between two✌🏻 consecutive candles; even candlestick patterns are filtered❌.
So, the type of chart is also essential👌🏻 for finding gaps.
Well, I gave you the basic tips to identify these gaps🤏🏻, and now you can carefully look👀 for them in your charts💹.
Practice this information for a bit, as I will be back soon🔜 with an educational post👨🏻🏫 on how to trade💰 with these gaps.
If you have any questions❓, you can ask me💬.
We will get acquainted with new clues🔎 in new posts, so until that day, take care of your knowledge📊 and increase it every day📈, because according to Kofi Anan:
Knowledge is power💪🏻, and information is liberating. Education📚 is the beginning of progress in every society🏙️, in every family👨👩👧👧.
I hope you become stronger🙌🏻 daily by using your knowledge, and I will also increase your progress by teaching you the introduction.
I wish🙌🏻 you happiness, health😍, and success😎.
Gap TheoryThe gap theory is short and simple. Not everything needs to be lengthy and laborious. "Everything should be simple as possible, but not any simpler"
Break-Away Gap
Once a new cycle has begun and you see a breakaway gap in the STARTING of a move, you get confirmation of this new cycle. HOLD.
Run-Away Gap
Once the trend is continuing for some time and then you see a second gap, this is a confirmation that you are somewhere in the MIDDLE of the move, so you know a further movement in price is expected. HOLD.
There is a possibility that you can get multiple runaway gaps.
Exhaustion Gap
After a move in price had already happened, a gap that signals the END of the move happens. If this is your 3rd gap on the, you should look very closely to distinguish if it is a runaway gap or exhaustion gap. SELL.
How do you tell the difference between the exhaustion gap and the runaway gap?
Easy, if after the gap happens the price shoot straight up without closing the gap in the next few days ---> runaway gap. HOLD.
if after the gap happens the price is closing the gap in the next few days ---> exhaustion gap. SELL.
If you like it, follow and like so it will be saved in your saved ideas for future reference.
What is a price gap? How to trade the price gap?What is a price gap?
A price gap appears on the price chart as a blank space, and the blank space represents the time when there was no trading activity in that particular price level.
4 Types of Price Gaps
1. A breakaway gap happens when the security traded in a narrow range for some time, and then the security jumps to a different price level. This indicates interest in the security to test a different price level.
2. A common gap happens because of traders daily buying and selling activity.
3. A continuation gap is a measuring gap to determine if the current trend will continue.
4. An exhaustion gap is a gap that happens toward the end of a trending period. This can be a sign of a price reversal is about to happen.
How to trade the price gap?
Traders should trade in the direction of the breakaway gap and continuation gap. Traders should consider carefully before adding to their current position when they encounter an exhaustion price gap.
What are some of the reasons one may fail to trade the price gap?
Possibly due to misinterpreting the exhaustion gap as a continuation gap, and possibly misinterpreting the bull or bear trap as a breakout gap. Possibly it was initially a continuation gap or a breakout gap correctly identified, but suddenly the trend changed direction and trapped the traders.
Thank you for reading!
Greenfield
Remember to click "Like" and "Follow!"
Disclosure: Chart interpreted and article prepared by Greenfield. A market idea by Greenfield Analysis LLC for educational material only.
The Importance of Gaps in Technical AnalysisThree types of gaps: Breakaway, Runaway or Measuring Gap and Exhaustion Gap.
Breakaway gap:
1.At a completion of an important price pattern and generally the breaking of a resistance occurs on a breakaway gap
They sign the beginning of a significant market move
2.Breaking of a major trendline, in a reversal signal can also see a breakaway gap
3.They occur on heavy volume
4. Heavier are the volume, less likely the gap will be filled
5.The gap could be filled (generally not all the gap)
6. Upside gap they can work as support areas for subsequent market corrections
7. During an uptrend, it is important that prices do not follow below the gap, otherwise it is a sign of weakness
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