Wick

Reading the three candles

Fair Value Gaps

Candle by candle

Candle 1 sets a high for a bullish gap or a low for a bearish gap. Candle 2 is the displacement candle, a long-bodied move in one direction. Candle 3 opens beyond candle 1's extreme, leaving the gap between them exposed.

Size of the middle candle matters

A tiny middle candle barely leaves a gap worth trading. A large, fast displacement candle leaves a wide, meaningful gap that shows real imbalance behind the move.

Works on any timeframe

You can spot an FVG on any timeframe, from a 1-minute chart to a weekly chart. The concept doesn't change, only the significance and the players behind the move do.

Check yourself

In a bullish FVG, the untraded gap sits between…

  1. Candle 1's high and candle 3's low correct
  2. Candle 2's open and its own close
  3. Candle 1's low and candle 2's high

The gap is the space candle 2 skipped: from where candle 1 topped out to where candle 3 starts trading.

Learn this properly

This term has a full interactive lesson in Wick — the chart, the pattern to tap, and a live practice terminal to try it on. Free to start.

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