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Breakaway gap

A gap that leaves a consolidation area or breaks a major level, usually on heavy volume, marking the start of a new move.

A breakaway gap appears at the edge of a base or range, not in the middle of a trend. The defining features are location, at a boundary, and volume, typically far above average.

Because they mark repricing rather than noise, breakaway gaps are the class least likely to produce a quick gap-fill. Traders who use gap classification treat these as gaps to trade with, not against.

The classification is retrospective. In the moment a large gap out of a base looks identical to an exhaustion-gap at the end of a move; only the following days reveal which it was. Trading it means accepting a wide stop or waiting for the opening-range to define one.

Related: runaway-gap, exhaustion-gap, common-gap, gap-and-go, kicker-pattern

See it drawn

Original diagrams for the ideas on this page. Illustrative, not real market data.

A range beside a trendOne chart swinging between a flat floor and ceiling, another stepping upwards inside a pair of sloping lines.Range-boundresistancesupportprice bounces between two levelsTrendingthe trend channelhigher highs and higher lowsA range has two flat edges; a trend has two sloping ones.
Range versus trend. On the left price keeps bouncing between the same floor and ceiling, which is a range. On the right each high and each low is higher than the last, inside a pair of sloping lines called a channel.

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