A Technical Approach To Trend Analysis: Practical Trade Timing for Enhanced Profits
by Michael C. Thomsett
Ex-Dividend Gaps
Many gaps are merely coincidence. These common gaps are found often in charts and can easily be misinterpreted. Only when proximity and price action justify defining a gap as runaway, breakaway, or exhaustion does the gap truly matter.
Because gaps are common, they should be analyzed and interpreted cautiously. Even the appearance of strong gaps with signal importance can be difficult. This is why confirmation of gap patterns is just as important for other forms of price signals. However, some gaps are associated with specific events and should be analyzed in their proper context.
Key Point
The ex-dividend gap is caused by price adjustment as dividends are earned. These are non-recurring gaps.
An ex-dividend gap can be found ...
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