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AdvancedLesson 4 of 4 · 8 min

Fair Value Gaps (FVG)

Three-candle imbalances and how they are used as areas of interest.

Illustrative chart · Bullish fair value gap
FVG1Revisit
A strong candle leaves a gap between the first candle's high and the third candle's low. Price later revisits the area (1).

Spotting the gap

Look at three consecutive candles. If the high of the first and the low of the third do not overlap, the space between them is a fair value gap — an area price moved through quickly.

Using it carefully

Gaps are often partially or fully revisited, but not always. Combine them with structure and higher-timeframe context rather than using them in isolation.

Key takeaways

  • Three candles, no overlap between 1 and 3.
  • Gaps are areas of interest, not signals.
  • Context first, gap second.

Charts are illustrative examples, not real market data. This content is for educational purposes only and is not financial advice.