Fair Value Gaps

Dollardogs

Dollardogs

Anybody use FVG in their trading? It has lots of applications, but I've mainly been using it for timing exits where I still struggle with hopping out of winners a little too early.

Setup in attached photo is from QQQ today. Orange bar = Fair Value Gap. For anyone unfamiliar with FVG, basically when you have a strong bullish or bearish candle, you label that candle "B" and measure the gap between the surrounding candles (A and C). Expect that gap to get filled fairly quickly, and if the FVG support breaks, I often get out. Saved my trade today.

Curious if anyone uses FVG in other ways? Appreciate any suggestions.
 

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Dollardogs said:
Anybody use FVG in their trading? It has lots of applications, but I've mainly been using it for timing exits where I still struggle with hopping out of winners a little too early.

Setup in attached photo is from QQQ today. Orange bar = Fair Value Gap. For anyone unfamiliar with FVG, basically when you have a strong bullish or bearish candle, you label that candle "B" and measure the gap between the surrounding candles (A and C). Expect that gap to get filled fairly quickly, and if the FVG support breaks, I often get out. Saved my trade today.

Curious if anyone uses FVG in other ways? Appreciate any suggestions.
More...

Yes. It's just one component.
 
The method requires displacement, a change in state of delivery and liquidity being sweep among other factors.
 
Thanks, I daytrade mainly, but I'm looking to branch out into swing trading more soon, so I'm hoping it'll be helpful for both.

The one thing I haven't figured out yet is obvious: there are FVGs all the time, how do you tell the meaningful ones from meaningless, besides noting excessively large exhaustion candles that are likely to get gap-filled later?
 
Dollardogs said:
Thanks, I daytrade mainly, but I'm looking to branch out into swing trading more soon, so I'm hoping it'll be helpful for both.

The one thing I haven't figured out yet is obvious: there are FVGs all the time, how do you tell the meaningful ones from meaningless, besides noting excessively large exhaustion candles that are likely to get gap-filled later?
More...

There has to be an obvious run toward and a sweeping of liquidity first. That’s why one has to start at the HTF’s and drill down. They occur on all TFs, but just like swings the lower TFs give more an opportunity to trade but the runs don’t last as long before liquidity is swept.

Even with daytrading, one needs to start at HTFs and drill down. A common mistake is not seeing the forest for the trees.
 
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