Gap Alerts


This tool sends you alerts on unusually volatile large-cap stocks that are gapping up/down pre-market by over 1.0%. It also pushes these alerts to your phone and laptop as a Discord alert accompanied by a screenshot of the chart at the instant of the alert and a link to the chart on TradingView (Figure 1).
Figure 1: Screenshot of the Gap Tool alert firing in Discord

Why was this tool built?

Scanners suck!!
  1. 1.
    They can find setups but they take a long time to look through.
  2. 2.
    They aren’t pushed to you as an alert or notification, you have to monitor them yourself.
  3. 3.
    They’re often not on the same screen as the chart of the stock you’re looking for, so they’re out of context.
An alert system like this addresses all of these issues.

What are the criteria to trigger an alert?

  1. 1.
    We scan over 100 large-cap stocks
  2. 2.
    Its daily Average True Range (ATR) must be higher than its 14-day ATR; aka it’s unusually volatile relative to its past behavior. This ensures we’re not just sending the same 5 volatile large caps every day!
  3. 3.
    It is a gap that has formed overnight and is still in effect during pre-market and at market open
  4. 4.
    It has a gap larger than 1.0% in either direction.
GAP=(market open - prior market close)prior market close\text{GAP}=\frac{\text{(market open - prior market close)}}{\text{prior market close}}
Figure 2: Gap Tool Criteria

So what?

This tool will hopefully help identify potential gap trades. What’s that?
Gaps in a stock chart occur when the price of a stock moves suddenly up or down, usually in response to news outside of market hours. In some cases, these gaps don’t last — rather, they’re “filled” as trading action brings the price back towards the previous close. These gap fills present opportunities for trading. (Center Point Securities)
TL;DR although gaps don’t always fill right away, they often do. Thus, they can be high-probability trades to start off the day.