The Four Gap Types

The classical gap taxonomy is a century old, but this school lets you derive it instead of memorizing it — because each type is just Chapter 15's fuel question, asked at a different location in Module 3's structural loop.

Common gap — the drift. Location: inside a range or congestion, no meaningful news. The thin-sentiment stretch from Chapter 15, printing within already-well-traded territory. Because thick liquidity resumes right where business was always happening, these fill quickly and often — the statistical source of the "gaps always fill" myth. Story told: nothing. Trade significance: minimal, beyond the fade tendency.

Breakaway gap — the verdict. Location: through a range edge or major level, on real fuel (results, a genuine catalyst). This is Chapter 14's BOS delivered by auction — the range's verdict announced overnight, with the breakout and the news arriving as one print. These are the gaps that don't "owe" a fill: the empty space sits over the old, now-irrelevant negotiation zone, and price has moved to a new one. A breakaway holding above the broken edge through the first hour of thick liquidity is among the strongest continuation evidence structure offers.

Runaway gap (measuring gap) — the acceleration. Location: mid-trend, in an already-established HH/HL sequence, often on incremental (not new-regime) news. The trend is so one-sided that even the overnight auction can't find willing counterparties near yesterday's price — demand gapping over supply mid-journey. Old-school traders called it "measuring" because it often appears near a trend's midpoint (folklore, not law — but the location logic is sound: it marks peak one-sidedness). Story told: the trend is in its most powerful phase.

Exhaustion gap — the last gasp. Location: late in an extended trend, often the largest and most emotional gap of the sequence, frequently on breathless news coverage — and it fails. Price gaps in the trend's direction one final time, then stalls and reverses back through the gap within days. Mechanically: the gap was the last cohort of latecomers buying at any price — and their climactic order flow is exactly what Chapter 13's large players sell into. An exhaustion gap that fills quickly is often the trend's obituary, and the CHoCH (Chapter 11) frequently follows within bars.

Notice the diagnostic key the century-old names were hiding: the same empty space means opposite things depending on structural location — through the edge (breakaway) vs. after a long run on peak emotion (exhaustion). And the tiebreaker between runaway and exhaustion — genuinely ambiguous in real time — is behavior after the print: runaways hold and extend (the sequence continues); exhaustions fill fast and crack structure. The gap proposes; the next few sessions dispose.