Inside-range gap breakout entry and stop rules

The inside-range opening

An inside-range gap is an opening above the prior close that remains below the prior high.

Gap trading in this workflow uses that opening discontinuity as the location for a later long signal rather than chasing a large gap through prior resistance.

An opening above the prior close can appear on morning percentage-gainer scans and draw follow-on buying.

Entry offset and breakout confirmation

The long trigger is placed 0.20 above the low of the gap-up bar. That measured entry-offset is the location of the later long signal.

Continuation through the prior session high is the breakout that completes the inside-gap setup. The breakout-system reading of the session waits for that continuation rather than treating the opening print as the completed event.

Stop-loss before the trade is live

The stop-loss is a pre-placed exit. On a same-day hold the initial stop is the prior session low. On a multi-day hold the initial stop is the prior session high.

Same-day exits are planned near a 0.80 increment, with reversals expected just under whole numbers. That planned close-out is the whole-number-exit used on a same-day hold.

The illustrated 24 July 2018 session

In the illustrated 24 July 2018 session the open moved from a prior close of 34.55 to 35 and later printed 35.80 before reversing.

Editorial: The later print at 35.80 sits at the 0.80 increment used for planned same-day exits. The archive records those prices and the reversal. It does not state that a fill, a stop or a close-out occurred, and it does not state a result.