What is a fair value gap (FVG)?
A fair value gap (FVG) is an imbalance left behind by a fast move: in a three-candle burst, the gap between the first candle's high and the third candle's low (or vice versa) that price never traded through calmly. Markets often come back to 'fill' these gaps.
When price moves violently, it skips levels — buyers and sellers never got to transact there. That untraded zone is the gap, and the market's tendency to revisit it gives structure traders a map: the gap becomes a magnet and, on the retest, a potential entry zone.
Smart Money Concepts strategies treat the FVG retest as their entry: trend first (a break of structure), then the gap, then the pullback into it, then a confirmation candle. No single gap is a guarantee — the edge is in demanding all four conditions at once.
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