an UpGap is when open is above prev day hod (high of day).
a DownGap is when open is below prev day lod (low of day).
an UpLap is when open is above prev day close.
a DownLap is when open is below prev day close.
we often trade upgaps and uplaps, based on sentiment. this sometimes works out okay, but in fact, statistically, downgap and downlap trades strongly outperform upgap and uplap trades across a one-week timeframe.
the quant view of this is that strategies seeking downgaps and downlaps of >10% are the best. (Aufan and Proclivity tramp plays LOL).
more abt the
Connors-Dorkins study can be read here
http://www.tradingmarkets.com/.site/...l/GapsLaps.cfm
Gaps and Laps
Linear Mode
