Have you ever pulled up a chart with several gaps and immediately started wondering what to do with all of them? Instead of reading the trend, you’re staring at a bunch of empty spaces on the chart and trying to figure out what each one means.
Here’s exactly how to handle it best.
When the Daily Chart Starts Feeling Noisy
During Ticker Request Live on May 26, 2026, we were looking at MercadoLibre (MELI).
On the daily chart, MELI had recently made a downside move with a gap. Before that, there had been another downside move with a gap. And if I went back through roughly the prior six months of price action, there were several more.
That can make a chart feel a little scary.
You start asking, “Is it going to go back and fill the gap? Is it going to ignore the gap?”
The key is in shifting your data to get more clear on what may happen next.
Go Up a Timeframe and Look at the Bigger Picture
The gaps that had been so noticeable on the daily chart. But I shifted to the weekly chart, and they were MUCH less distracting.
More importantly, the bigger-picture trend was easier to see.
That’s really the point of doing this. Going up a timeframe (daily to weekly, 5-minute to 30-minute, etc.) allows you to temporarily step away from some of the immediate price movement so you can get a better sense of where the market has actually been going.
In MELI’s case, once I looked at the weekly chart, the larger trend was clearly down. Right away that gave me more useful information than sitting there debating whether one particular daily gap might eventually fill.
I could then use the weekly chart to identify meaningful areas of support or resistance, including recent highs or lows that mattered within that bigger trend.
Bring Those Levels Back to Your Trading Timeframe
Moving up to the weekly doesn’t mean you suddenly have to trade the weekly timeframe. You can use it to get a better view of the bigger-picture trend and identify meaningful support or resistance, then translate those levels back to the daily chart.
That’s exactly what I was doing with MELI. Once I could see that the larger trend was down, I could look at the most recent lower high or any other evidence of resistance or support on the weekly chart, then bring that information back with me when I returned to the daily.
Now I was looking at the same gaps, but I had more information about the trend they’re happening within.
Don’t Get Freaked Out by Gaps
I get this question all the time: What about a stock that has a lot of gaps? Is the gap going to get filled?
Well, I don’t know. Nobody does.
And with MELI, once I looked at the higher timeframe, I didn’t need to get hung up on that question. The weekly chart showed me that the bigger-picture trend was down, and that gave me something much more useful to work with when I went back to the daily chart.
So don’t get freaked out by gaps. You can always go up a timeframe to “hide” the gaps, get a better look at the bigger-picture trend, identify the support or resistance that matters there, and then come back to your trading timeframe to face those gaps head-on.
This time, you’re coming back with more information.
👉 PS — Trader Trainings Coming Up!
Visit himareddy.com/events for full details and registration.
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