Fair Value Gap or FVG indicator MT5
Fair Value Gap or FVG indicator MT5
The Fair Value Gap (FVG) Indicator is a valuable asset for traders using MetaTrader 5, designed to highlight market inefficiencies. An FVG occurs when an imbalance between supply and demand causes a rapid price movement. To understand this, picture three consecutive candlesticks; the space between the first and third candlestick represents the "FVG." This indicator automatically marks these gaps on the chart using dynamic boxes—green for bullish FVGs and red for bearish FVGs.
«Indicator Installation & User Guide»
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Indicator Specifications Table
Category | ICT - Liquidity - Smart Money |
Platform | MetaTrader 5 |
Skill Level | Intermediate |
Indicator Type | Reversal - Continuation |
Timeframe | Multi-timeframe |
Trading Style | Day Trading |
Trading Markets | All Markets |
Overview of the Indicator
The Fair Value Gap (FVG) Indicator detects supply and demand imbalances and automatically highlights these areas on the chart. These gaps provide insights into key support and resistance levels, improving entry and exit strategies.
Uptrend Condition
A 1-hour EUR/USD chart illustrates how FVGs develop. During an upward trend, a retracement touches the FVG before the price resumes its movement. This zone is an excellent entry point for a long (buy) trade.
Downtrend Condition
On a 1-hour GBP/USD chart, a downward trend experiences a price pullback that reaches the FVG zone before continuing downward. When price revisits these areas, it presents an opportunity for entering short (sell) trades.
Settings
- Display Theme: Switch between dark and light chart backgrounds.
- Candlestick Range: Set the number of candles (default: 1000) used for FVG calculations.
- Object Suffix: Customize the suffix for FVG boxes on the chart.
- FVG Calculation Mode: Select the method used to determine FVGs.
- Show FVGs: Enable or disable FVG box visualization.
- Show Last FVGs: When activated, only the most recent FVGs are displayed.
Summary
The Fair Value Gap (FVG) Indicator is an effective tool for pinpointing precise entry and exit points, as well as identifying essential support and resistance zones. Designed for MetaTrader 5, this indicator is particularly beneficial for seasoned traders familiar with liquidity dynamics and market structure.