A Fair Value Gap (FVG) is an imbalance left when price moves so quickly that a three-candle sequence leaves an untraded gap. Markets often — but not always — return to rebalance these areas.
Spotting an FVG
- Look for a strong impulsive candle between two others
- The gap is the untraded space between the first and third candle's wicks
- It carries more weight when aligned with structure and an order block
A word of caution
Not every gap fills, and not every fill continues. Use FVGs as confluence within a plan, never as a standalone signal. Educational content only.
Risk Disclaimer: This article is for educational and informational purposes only and does not constitute investment advice. Trading involves substantial risk of loss.