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The Gap theory is only relevant in microcaps controlled by day...

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62

22/01/19

01:58

Post #: 37181183
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Originally posted by 82Punter: ↑

Ah yes the old self fulfilling gap prophecy!
It's as though the gap actually has bearing on the market value of the company... I can just picture an analyst assessing a potential takeover target and saying 'well the EV is about $100m so the offer per share should be in the $0.50 region, but there's a gap that hasn't been filled yet at $0.35 so that devalues the whole EV to only $70m because the SP has to fall to $0.35 to close that gap before any real value can be achieved'

But I guess, as with other stocks I've been in, we just have to let the gap be filled so that the superstitious traders out there can be satisfied

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The Gap theory is only relevant in microcaps controlled by day traders for pips. A fundamental event for a company as you mentioned is key, and gap believers will miss the boat once insto money starts buying into a de-risked stock.

VEC Price at posting: 2.2¢ Sentiment: Buy Disclosure: Held
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2 Great analysis

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