Lesson 4: Fair Value Gap (FVG)1Lesson 4: Fair Value Gap (FVG) Displacement creates imbalances. These are referred to as FVG's. These are areas of interest to add when we have market structure and trend supporting the idea. A FVG is usually coupled with a/an order block(s). From the last lesson, here is an FVG that is created after taking major yearly SSL. What else can be added to this chart that we now know to look for when have displacement? Order Blocks!
Lesson 4: Fair Value Gap (FVG)2Recall, an OB is an area where you want to buy or sell. In this scenario, the mss is to the upside, therefore, this OB AND FVG is showing us where we can go long! Our targets for longs are the recent swing highs. How do FVG's work? Recall an imbalance is an area where we have an incomplete auction of buyers and sellers. They're are orders waiting to be filled within the imbalance. So this FVG is an area of liquidity for buyers and sellers to transact and complete their orders. Direction comes from our analysis of liquidity and mss. The FVG is just an area where we know price can eventually retrace back into. Just because there is an FVG present, it does NOT mean we should be buying or selling. The narrative of what price wants to do is what determines our execution process of buying or selling.
Lesson 4: Fair Value Gap (FVG)3So in this example, the narrative is shifting from shorting the highs to now awaiting an opportunity to go long. Why do FVG's work? They're described as an imbalance where we have left orders behind/pending. If our narrative for price is higher, we will look for signs of confluence to add long in a FVG. Vice versa for shorts. For example, EMA traders will use their specific ema system to add into a trend. Chances are, this is where the FVG overlaps. Support and Resistance traders will add near support, this is where the FVG and OB structure usually setups up the entry. Supply and Demand traders like to add in their zones. This is where order blocks and FVG's provide entries. Order flow traders will look for bullish or bearish flows at specific areas to confirm the trend. This is where FVG's are most likely to be. Other tools like heatmap that illustrate order sizes at specific levels also overlap with FVG's and OB's.
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'Fair Value Gap is a range in Price Delivery where one side of the Market Liquidity is offered and typically confirmed with a Liquidity Void on the Lower Time Frame in the same range of price. Price can actually 'gap' to create a literal vacuum of trading thus posting an actual Price Gap' .
The term ICT can be defined as “the integration of computing, networking, and information processing technologies and their applications.” Thus, ICT means a combination of computer applications and communication technology for gathering, processing, storing, and disseminating Information.
ICT is technology that supports activities involving information. Such activities include gathering, processing, storing and presenting data. Increasingly these activities also involve collaboration and communication.
Information and Communication Technologies (ICTs) is a broader term for Information Technology (IT), which refers to all communication technologies, including the internet, wireless networks, cell phones, computers, software, middleware, video-conferencing, social networking, and other media applications and services ...
In simple terms, the ICT strategy is all about following the price action. The underlying philosophy is that the price drives success regardless of all market concepts, investors' behaviours and intentions. So, the price movements and swings should naturally be the most important metric to monitor, analyse and act on.
Another way of looking at it is that ICT stands for: Information – (or data) in paper or electronic format. Communication – in person or electronically (electronic communications), in writing or voice, telecommunications, and broadcasting. Information technology (IT) – including software, hardware and electronics.
Introduction: My name is Duane Harber, I am a modern, clever, handsome, fair, agreeable, inexpensive, beautiful person who loves writing and wants to share my knowledge and understanding with you.
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