In
technical analysis, a break on a
chart representing a sudden and large price movement accompanied by high
trading volume. Generally speaking, charts do not show trading gaps because price movements, even when large, occur smoothly enough to not require a break in the chart. Trading gaps may occur, for example, when the price of a security suddenly doubles or halves. As with many charting terms, it may be
bullish or
bearish; a sudden movement upward is a bullish trading gap, while a sudden movement downward is bearish. It may occur when there is a significant break between the
bid and the
ask, or when
trading temporarily stops in anticipation of a major news announcement by the company.