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Gap or Gapping

In trading, a gap or gapping refers to a situation where the price of a financial instrument (such as a stock or a currency pair) opens significantly higher or lower than its previous closing price, without any trading occurring in between. This can happen for a variety of reasons, such as a significant news event or a change in market sentiment. A gap is often considered to be significant as it can signal a strong shift in market sentiment and can provide trading opportunities for traders who anticipate the direction of the price movement.

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