Gap Indicator for Identifying Open and Closed Price Gaps
Summary
The indicator marks bullish gaps with upward arrows and bearish gaps with downward arrows. Traders can set a minimum gap size in points so smaller gaps are ignored. An optional history check can identify gaps that later close, displaying a cross for closed gaps or hiding them; users can also limit how many past bars are checked.
The suggested use depends on a gap’s age and direction: a fresh, still-open gap can act as an entry filter in the direction of the gap, while an older open gap can serve as a potential target for a trade in the opposite direction. The description explains the display controls and a possible trading interpretation, but provides no formal gap definition, market-specific guidance, backtest, or evidence that either use is profitable. Signal reliability and practical results will depend on how gaps and closure are defined and on execution conditions.
Key ideas
- The indicator marks upward and downward price gaps with directional arrows.
- A minimum size setting filters out gaps below the chosen threshold.
- Optional history checking can mark closed gaps or hide them, with a configurable lookback.
- Fresh open gaps are suggested as same-direction entry filters.
- Older open gaps are suggested as potential targets for opposite-direction trades, without supporting performance evidence.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.