Gap and go
Gap and go is a day-trading setup in which a stock opens well above the previous day's close, usually on news, and keeps rising after the open instead of falling back to fill the gap. Traders look to buy as it breaks the high of the pre-market or of the first candles after the opening bell.
Why it matters to a small-cap momentum trader
It is one of the core morning setups because most of the work happens before the bell. The gap scanner lists the stocks up the most since yesterday's close, and the trader narrows them down by catalyst, float and relative volume. The strongest candidates tend to have fresh news, a low float and heavy pre-market volume. The risk is the gap fill: a stock that cannot hold its pre-market levels at the open can give back the whole gap quickly.
How it is measured and traded
Gap = the current price divided by the previous day's close, minus 1. Before 9:30 the current price is the latest pre-market trade.
A common plan. Mark the pre-market high. Buy the break of it near or after the open, with a stop under a nearby low, such as the low of the first pullback. If the stock loses VWAP or falls back into the gap, the setup has failed.
There is no rule behind gap and go, only a plan, and every trader sets their own thresholds.
Gap and go in Hindsight Markets
The gappers scanner comes ready, and its gap column works before the bell too, measured from the previous day's official close. Start a replay at 4:00 a.m. and watch the gappers form, or start at the 9:30 bell and see how the open treats them.
Practice this on a real past day in Hindsight Markets
Start a real past day at 4:00 a.m., build your watchlist from the gappers, and trade the open with simulated money.