A price gap describes the situation where a stock opens at a price either higher or lower than the closing price the day before. This usually happens when some news affecting the value of the stock is announced after the market closes, e.g., positive or negative earnings, a buy-out, etc. Stocks that gap at the open often move back toward the previous close before moving again, but not always. Strong news such as projected higher earnings from the company tend to drive the stock without the pull back.