In plain English
What Price gap means
Price gaps appear when the next session starts at a different price than where the last session ended. On a chart, that creates an empty space between bars or candles. Gaps can happen after news, earnings, or a market reopening, and they are common in assets that trade with distinct sessions or overnight closures.
Why it matters
Gaps can affect support and resistance, stop placement, and execution price. They matter because orders may fill at a worse price than expected when the market opens away from the prior close. In forex spot trading, true session gaps are less common than in exchange-traded markets, but they can still appear around weekends or major market interruptions.
Example
If a stock closes at 100 on Friday and opens at 104 on Monday without trading at 101, 102, or 103, that is an upward price gap. Simplified example: the opening price skipped over part of the prior range.
Quick answers
Common questions
Do all markets gap?+
No. Gaps are more common in markets with discrete trading sessions or overnight breaks than in continuously quoted markets.
Is a gap the same as slippage?+
No. A gap is a price discontinuity on the chart; slippage is the difference between expected and filled execution price.
Sources