In the crypto market, traders that are able to convert the large jump that happens in the value of cryptocurrencies into opportunities will benefit a lot. As a volatile market, the crypto market may deal with gaps in its charts, which are areas where the value of the crypto moves steeply either up or down, and it has little or no trading between both sharp points. This makes the chart look like a gap exists in the regular price trend. When a trader sees this gap, they can use it to their advantage.
Usually, a gap may appear from nowhere as a result of some technical or fundamental issues. Typically, the gaps that appear in a crypto market can be divided into four types, and they are breakaway gaps, exhaustion gaps, common gaps, and continuation gaps.
Breakaway gaps are those that happen when the price trend ends, and it usually evidences the starting of a new trend.
Exhaustion gaps happen close to the ending of the price trend, and it displays the last trial to get to a new high or low.
Common gaps are not present in a price trend. It shows the part where the price has been gapped.
Continuation gaps of runaway gaps appear in the center of a price trend and display that there is a cluster of buyers or sells that have similar thoughts on the future price of the crypto.
A crypto trader may decide to buy if the technical or fundamental factor leads to a gap soon. They may buy crypto if the platform behind the token has launched an innovative project or is about to launch one.
Crypto traders use the gaps when they see opportunities, and as always do your due diligence before making any decisions in the market.