GAP on the chart #BTC and why it is important?
In technical analysis, a GAP is a gap on the price chart that occurs when the opening price of a new trading session significantly differs from the closing price of the previous one.
GAPs can be upward (opening price is higher than the closing price) or downward (opening price is lower than the closing price).
GAPs often arise due to non-trading time between sessions when new information affects the price, but the market is not yet open.
On the Bitcoin chart, gaps most often form in futures markets (e.g., CME Bitcoin Futures), as trading there does not occur around the clock, but only during working hours. In the Binance spot market, gaps are less common because cryptocurrencies are traded 24/7.
Why are gaps important? - Traders often watch them, as the market tends to return and "close" them.
Where to look for gaps? - TradingView (on the CME Bitcoin Futures chart).
At the moment, we have an open gap around 114k, and as a rule, they always close. But there is also a small one around 121k.
Use this information as analysis for future trades and do not rush into trades without weighing the risks.