FVGs & CEs + Alerts: simple & efficient method

How it works

The Fair Value Gap (FVG) indicator identifies 'naked' price bodies where wicks on either side do not meet, creating a visual representation of market gaps. It automatically paints these gaps on the chart, tracking their midlines (Consequent Encroachment or CE) and monitoring price interaction with these areas.

The indicator allows users to customize settings such as painting direction, midline visibility, and historical lookback period. It automatically stops painting FVGs when price reaches specified thresholds, either at the midline or when fully filled, providing a dynamic and interactive tool for analyzing price behavior.

Why it may be useful

Fair Value Gaps provide traders with insights into potential price sensitivity and market inefficiencies, revealing areas where price may naturally seek to fill or rebalance. By highlighting these gaps, traders can identify potential entry and exit points, understanding the market's tendency to revisit and interact with these specific price zones.

The indicator's ability to automatically track and terminate FVGs offers a streamlined approach to analyzing market structure, helping traders quickly identify meaningful price levels and potential trading opportunities without manual tracking.

When to explore it

The Fair Value Gap indicator works best in markets with clear price movements and identifiable gaps, such as futures, forex, and some stock markets. It is particularly effective on timeframes that provide sufficient price resolution to accurately identify and track these gaps, typically ranging from 5-minute to daily charts.

Traders should use this indicator in conjunction with other technical analysis tools and market context, avoiding blind reliance on FVG signals. It is most valuable when integrated into a comprehensive trading strategy that considers market structure, trend, and additional confirming indicators.

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