A Fair Value Gap appears when the market makes a sharp, fast move in one direction. This usually happens during strong momentum, news events, or periods of low liquidity. Because price jumps over part of the chart without normal trading, that area is considered “inefficient” and may attract price later.
FVGs are used in technical and price-action strategies, including the ICT methodology. Traders watch these gaps because the market often returns to them to rebalance orders or fill areas where buyers and sellers did not interact. FVGs can signal potential entry areas, continuation zones, or places where price may pause.
FVGs appear on all timeframes—from 1-minute charts to daily and weekly charts. Higher-timeframe gaps often carry more weight because they reflect stronger institutional activity. While not every gap fills, many do, making them useful reference points for both intraday and swing trading.
Fair Value Gaps help traders understand where the market moved too aggressively and where future price action may develop. They highlight imbalances and areas where liquidity may still be untested.
FVGs form when strong buying or selling forces push price forward quickly—often faster than the market can match orders. News events, session opens, and sudden shifts in sentiment can all cause these fast moves. With so little trading inside the gap, the market often comes back later to fill the missing price action. These gaps help identify where imbalances first appeared.
Many FVGs fill at some point, but not all. Gaps created during extreme momentum or major trend phases may stay open for a long time. Traders study volume, market structure, and the strength of the trend to decide how likely a gap is to fill soon. The timeframe also matters—higher-timeframe gaps tend to hold more significance.
Traders mark the gap and watch how price reacts when it revisits that area. Some look for entries at or inside the gap when the trend resumes after a pullback. Others use gaps as targets for taking profits. When paired with structure concepts like liquidity, order blocks, and session timing, FVGs help traders plan precise entries and exits.
A strong economic announcement pushes EUR/USD upward quickly. The move leaves a clear Fair Value Gap on the 15-minute chart. Hours later, price retraces into the gap before continuing higher, giving traders a structured area to plan entries.
FinFeedAPI’s Stock API and Currencies API provide clean, timestamped price data that traders use to identify FVGs, analyze how often gaps fill, and build automated tools that scan for price imbalances across markets.
