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Tech Guy Explanation of Chart Gaps 8/31/22

First of all, gaps are always unfinished business! It is more bullish if a gap up is not filled within a few days, but more stable if it is filled. Gaps also function as support or resistance. Dec Corn has marked 4 gaps (not 3) since the July 22nd low - 2 now have been filled - they became support.

The gap on Aug 8th in Dec Corn was filled in a few days - just below the fill was support at 604-608, then corn rallied to a new level. The gaps that are filled are common gaps.

The gap on Aug 22nd is still the breakaway gap at 631 - it most definitely should not get filled. As long as Dec Corn continues to mark higher highs and lows, it remains in an uptrend.

The gap up from Sunday night's open was filled this morning. Therefore the price area just below the fill (665-660) is support that Dec Corn should buy up from. The only difference is that Dec Corn is not in a run-away market. It is simply stair stepping to mark new highs to accumulate needed energy to go higher - Wasn't ready to fully break out as it appeared.

The main difference between filled/not filled is the urgency or lack thereof. Dec Corn is not going parabolic (straight up) now (as I thought it would), but still going up. Actually the gap being filled indicates a more stable market. The Dec Corn needed to find more energy to break out fully above 682-684 - backfilling the gap helps accomplish this energy accumulation.

Gaps are a potentially confusing topic in technical analysis and it's difficult to find the words to explain - I understand it more visually from the chart than I'm able to describe, but I hope this shed some light on the matter! If nothing else know they are support and resistance levels - and unfinished business.

Please refer to the updated Dec Corn chart to see all 4 gaps (red arrow) and how the price action has behaved around them - notice the progressively higher price levels.

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