Gap

A gap is an area on a chart where there is little to no trading in between abrupt increases or decreases in the price of a currency pair. The bar or candlestick chart displays a "gap" in the normal price pattern as a result.

Gapping can occur in the forex market as the currencies are traded only 5 days a week. Even though this market is closed for trading during the weekend, it is still open to central banks which makes it possible that the opening price on a Monday will be different from the closing price on Friday. This exactly results in a price gap.

Gaps can also happen during unexpected economic data releases and after a weekend or a holiday.