FAIR VALUE GAP (FVG) EXPLAINED
Content uploaded by Rehman Rony | 2025
What Is an FVG?
Fair Value Gap, commonly called FVG, is a technical-analysis concept used to describe a price imbalance created during a strong and rapid market movement. It is commonly identified by studying three consecutive candles and the relationship between their wicks.
Traders may mark these areas on a chart as zones of interest when studying price structure and market behavior. An FVG should not be treated as a guaranteed reversal or trading signal.
Bullish & Bearish FVG
Bullish FVG
A bullish FVG is associated with a strong upward price movement where the surrounding candles leave an imbalance in the price structure.
Bearish FVG
A bearish FVG is associated with a strong downward price movement where the surrounding candles create an imbalance in the price structure.
Understanding Market Imbalance
FVG analysis focuses on areas created when price moves rapidly in one direction. These zones can help students of technical analysis understand how strong price movements appear on a chart.
Market behavior is uncertain, however, and price does not have to return to or react from every FVG. Technical-analysis concepts are therefore best studied as analytical tools rather than guarantees.
Key Concepts
Observe strong and rapid directional movements on the chart.
Study the relationship between consecutive candles and their wicks when identifying an imbalance.
Consider the broader market structure rather than viewing an FVG in isolation.
No chart pattern can guarantee a particular market outcome.
Educational Disclaimer
This content is provided for educational purposes only. FVG is a technical-analysis concept and does not guarantee profits or predict future price movements. Financial markets involve substantial risk, and this page should not be considered financial advice.
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