Trends/Gaps and breakouts

Exhaustion gap

A gap near the end of a long move, which is then followed by price turning.

Gaps and breakoutsBest on 6M, 1YAlso called terminal gap

Illustration of the exhaustion gap shape. It is a sketch, not real price data.

What it shows

An exhaustion gap is a gap that comes after a long run, and price then stalls or reverses within a few bars. Whether a gap was exhaustion can be known only afterwards.

We label a gap after a long move when price then fails to make new highs within five bars.

How we find it

The same code that draws it on your chart follows these steps, with the same result every time.

Find a gap after a 40-bar move of at least 25%.
Check price fails to make a new extreme in the next 5 bars.
Check the gap is filled within 10 bars.
Mark the gap.

Starting values: Prior move 40 bars, 25%; Follow-up 5 and 10 bars. These are proposed and will be tuned on real price data before launch.

How to read it

The gold zone is the gap.
Price stalled after the gap.
The gap was closed soon after.

Status labels you may see

Label	What it means
Matches	Rule met in the last 20 bars.
Not matched	A gap that did not meet the rule.
None	No gap.

What cancels it

Cancelled if price makes a new high in the following bars.

What traders check next

Volume on the gap day.
How fast the gap was filled.
The prior move.

Limits

Hindsight label.
Many gaps after long moves do not exhaust.
Rare.

Try it in forecastviz

Open any ticker and choose Gaps and breakouts → Exhaustion gap in the left menu.
Switch between 6M, 1Y to see how the picture changes.
Compare with Breakaway gap and Runaway gap on the same chart.

Open on a ticker

Questions

Can I see it in real time?

Not reliably. The label needs later bars.

Is it a sell signal?

No.