Fair value gap — Trading Glossary

A three-candle pattern left by a fast move, where the first candle's high and the third candle's low (in a rally) do not overlap. The empty range between them is the gap.

Price often returns to trade into part of the gap. Inside a golden zone, a gap adds confluence; a tap of it followed by a strong close is the confirmation the Fibonacci lesson waits for.

Also called: fvg, imbalance, price imbalance.

Taught in

The Fibonacci Golden Zone (Honest Version)Strategy Playbook

How to draw the 0.618–0.79 zone, why it is a zone and not a prediction, the confirmation to wait for, the risk math, and when to walk away.

Also covered in that lesson

Fibonacci retracementA tool drawn from the swing low to the swing high of a move (or high to low) that marks how far a pullback has gone back, as a fraction of the move — 0.382, 0.5, 0.618, 0.786 and so on.Golden zoneThe band between the 0.618 and 0.79 Fibonacci retracement levels, where a pullback inside a trend commonly pauses. A zone covering about 17% of the move, not an exact turning point.

Related terms

Golden zone Expansion candle Confluence