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    The document discusses the concept of a Fair Value Gap (FVG), which is a price range where one side of market liquidity is offered that creates a gap or void in liquidity on lower timeframes. An FVG can be identified by a three candle formation where the gap between the candles remains unfilled. The document provides an example of a bearish FVG and explains how an FVG is created due to imbalance between buy and sell-side liquidity. When an FVG forms, price action within the gap region is expected to eventually trade back into the area to fill the void.

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    The document discusses the concept of a Fair Value Gap (FVG), which is a price range where one side of market liquidity is offered that creates a gap or void in liquidity on lower timeframes. An FVG can be identified by a three candle formation where the gap between the candles remains unfilled. The document provides an example of a bearish FVG and explains how an FVG is created due to imbalance between buy and sell-side liquidity. When an FVG forms, price action within the gap region is expected to eventually trade back into the area to fill the void.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
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    Download as pdf or txt
    617 views8 pages

    FVG Guide PDF

    Uploaded by

    StatusPedia
    The document discusses the concept of a Fair Value Gap (FVG), which is a price range where one side of market liquidity is offered that creates a gap or void in liquidity on lower timeframes. An FVG can be identified by a three candle formation where the gap between the candles remains unfilled. The document provides an example of a bearish FVG and explains how an FVG is created due to imbalance between buy and sell-side liquidity. When an FVG forms, price action within the gap region is expected to eventually trade back into the area to fill the void.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
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    of 8

    FVG

    II
    Guide

    Educational Trade Guide by Trader Daan


    What is it?

    FVG I
    Fair Value Gap is a range
    in price delivery where
    one side of the Market
    Liquidity is offered and
    typically confirmed with a

    I
    liquidity void on the lower
    time frame charts in the
    same range of price. Price
    can actual “gap” to create
    a literal vacuum of trading
    thus posting an actual
    Price Gap.
    Balance

    I
    I

    I often make the


    comparison with a scale.
    When a scale is in balance
    the two plates will hang
    right next to each other.
    When one of the plates
    contain more weight, we
    will identify an imbalance.
    This also occurs in the
    market. When we have
    more participants on one
    side of the market, a FVG
    will be created.
    How to identify an FVG?

    This is the candle


    that comprises the
    FVG.
    The low to the close
    offered Buy Side
    Liquidity.

    The open to the high


    offered Buy Side
    Liquidity.

    In the picture above you can see an example of a bearish


    FVG. The FVG is annotated with the blue shaded area. The

    I I
    FVG is identified by a three-candle formation. The leftover
    gap between the two candles is the Fair Value Gap. When a
    gap occurs one a higher timeframe it is expected to see a
    liquidity void to be created when you zoom in on the lower
    timeframe of that same region.
    “We refer to a Bearish FVG as SIBI
    and a Bullish FVG is called BISI”

    SIBI = Sellside Imbalance Buyside Inefficiency


    BISI = Buyside Imbalance Buyside Inefficiency
    When a Fair Value Gap is
    created only one side of the
    market was able to deliver price.

    I
    The leftover gap contains
    porous price action. What we
    expect is that price eventually
    wants to trade back into the
    area of the Fair Value Gap.

    I What to expect?

    v
    Source
    I

    Inner Circle Trader


    I

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