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Trading Strategies

Gap and Go

A day trading strategy that buys stocks gapping up on news/earnings in pre-market and rides the momentum at the open.

What is Gap and Go?

Gap and Go is a day trading strategy focused on stocks that gap up significantly in pre-market (typically 5%+ on high volume) due to news, earnings, or a catalyst. Traders buy early and ride the momentum.

Setup criteria

  • Gap up 5%+ with a clear catalyst (news, earnings beat, FDA approval)
  • High pre-market volume: RVOL above 3-5x
  • Low float preferred: under 20 million shares for bigger moves
  • Clean chart: no major resistance nearby

Entry and exit

Enter on the first pullback after the opening push (often to VWAP or the 9 EMA on the 1-minute chart). Take profits in stages: 1/3 at the first target, 1/3 at the second, trail the rest.

Related Terms

Gap

When a stock opens significantly higher or lower than its previous close, creating a 'gap' on the chart.

Momentum Trading

A strategy that buys stocks making strong moves on high volume, riding the trend until momentum fades.

Opening Drive

The first 30-60 minutes after the market opens (9:30-10:00 or 10:00 AM ET), characterized by the highest volume and volatility of the day as overnight orders, gap reactions, and early momentum trades execute.

Opening Range Breakout (ORB)

A day trading strategy that marks the high and low of the first 15 or 30 minutes after market open, then trades the breakout in whichever direction price moves outside that range.

Relative Volume (RVOL)

A ratio comparing the current trading volume to the average volume over a lookback period, typically 10 or 20 days. An RVOL of 2.0 means twice the normal volume.