About gaps: A gap is a “jump” in a security’s price between the Open and the Prior Close. Gaps are very common in stocks during opening hours, especially when accompanied by catalysts.
What this indicator does: This script will identify gaps that remained unfilled for at least one candle.
It is very common for gaps to be filled on the first candle, these gaps are arguably less meaningful, so they are ignored by the indicator to reduce the number of lines drawn.
Applications: Since most gaps eventually get filled, the question is a matter of when. If going with the trend, a trader will open a long/short position when seeing an up/down gap. When going against the trend, then short/long the stock on up/down gaps and consider taking profits when price returns to where the gap originally occurred.
Originally intended for 1D timeframes, but gaps can occur in all timeframes. Applications are limitless.
Versionshinweise
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Set overlay=true
Versionshinweise
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UpdateS:
Added adjustable threshold (%) in settings. Gaps with distances below this benchmark will not be plotted.
Versionshinweise
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Refactored, and added alerts.
Versionshinweise
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Removing lines associated with filled gaps, only showing unfilled gaps.
Hello. It is not finding gap if current candle green and before one is red. Can you check thar?
stavloizou
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Hi there, great script. i was wondering is it possible to have the drawing use a 1 min candle for the gaps but keep them on the chart if you change to say horly?