Fair value gaps (FVG) highlight imbalances areas between market participants and have become popular amongst technical analysts. The following script aims to display fair value gaps alongside the percentage of filled gaps and the average duration (in bars) before gaps are filled.
Users can be alerted when an FVG is filled using the alerts built into this script.
🔶 USAGE
In practice, FVG's highlight areas of support (bullish FVG) and resistances (bearish FVG). Once a gap is filled, suggesting the end of the imbalance, we can expect the price to reverse.
This approach is more contrarian in nature, users wishing to use a more trend-following approach can use the identification of FVG as direct signals, going long with the identification of a bullish FVG, and short with a bearish FVG.
🔹Mitigation
By default, the script highlights the areas of only unmitigated FVG's. Users can however highlight the mitigation level of mitigated FVG's, that is the lower extremity of bullish FVG's and the upper extremity of bearish FVG's.
The user can track the evolution of a mitigated FVG's using the "Dynamic" setting.
🔹Threshold
The gap height can be used to determine the degree of imbalance between buying and selling market participants. Users can filter fair value gaps based on the gap height using the "Threshold %" setting. Using the "Auto" will make use of an automatic threshold, only keeping more volatile FVG's.
🔶 DETAILS
We use the following rules for detecting FVG's in this script:
so wait hold on , so these broken lines are they used as stop loss take profit
GSRosso
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@TradingSnip3r, Entries actually
Prize_Fighter
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Do you enter at FVG or OB? Or FVG only after an OB? How does SMC do it?
Ace_Algo_
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How do I get this?
WouterBelgium
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@Frankieiscool1234, just add the indicator to ur chart. Its free
RapidRiseTrader
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It appears to be that bearish alerts are not working. I tried to plot them but they are not displayed on fill.
// --------- Alerts plotshape( bull_filled_cnd ? close : na, title = "Buy Label", text = "Buy", textcolor = c_white, color = c_green100, transp = 0, style = shape.labelup, size = size.normal, location = location.belowbar)
plotshape( bear_filled_cnd ? close: na, title = "Sell Label", text = "Sell", textcolor = c_white, color = c_red100, transp = 0, style = shape.labeldown, size = size.normal, location = location.abovebar)
ironeagl01
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@RapidRiseTrader, right bc the condition isnt valid, it should be (low(t-2) - high) / high >threshold (instead of (low(t-2) - high) / high < -threshold)
jai_walker
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Whats "Av Duration" is this minutes? %? based on what time frame?