📘 Understanding ICT Fair Value Gap (FVG): A Key Price Imbalance Concept
A Fair Value Gap (FVG) in ICT (Inner Circle Trader) methodology represents a price imbalance created when the market moves too quickly for all orders to be executed efficiently. Popularized through ICT's institutional trading models, FVGs highlight zones where price may later revisit to “rebalance.” There are two types: Bullish FVG and Bearish FVG.
A Bullish FVG forms when three strong upward candles create an upside imbalance. In NETWEB’s daily chart (August 2024), a notable Bullish FVG appeared: on 16 August, a green candle formed, followed by another large green candle on 19 August, and a third bullish candle on 20 August. The gap between the first candle’s high and the third candle’s low created the Bullish FVG.
According to ICT principles, price often retraces to this imbalance zone—exactly what
