A “gapper” is a stock that has experienced a significant price gap, meaning its opening price is much higher or lower than the previous day’s closing price, with little or no trading in between. These movements are often driven by news, such as earnings reports, and are watched by traders for potential opportunities, but they also carry higher risk due to volatility.
Entry
- Buy the first serious pullback after the initial blast.
- Confirm with:
- MACD still rising
- RSI still strong
- Volume still heavy
- Price holding above VWAP
Exit
You do not wait for “confirmation.”
You exit on the first sign of momentum failure:
- MACD crosses down
- RSI drops below 60
- A lower low forms on 5 or 10 minute
- VWAP breaks
- Volume dies
You get off fast.
These stocks give zero mercy once the wave ends.