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Imbalance aka FVG in trading

  To identify the correct Fair Value Gaps (FVGs) and imbalances for drawing a valid Demand Zone , you need to look for specific structural clues on your chart. [ 1 ] Core Criteria for Demand FVGs Three-Candle Pattern : The imbalance must exist between Candle 1's high and Candle 3's low in a bullish sequence. Expansion Candle : Candle 2 must be a large, aggressive bullish candle showing strong institutional buying. Unmitigated Gap : The price must not have returned to fill the space between Candle 1 and Candle 3 yet. [ 1 , 2 , 3 ] How to Filter for the Best FVGs Market Structure Shift (MSS) : Only look for FVGs that occur right as price breaks a recent swing high. [ 1 ] Discount Pricing : Apply a Fibonacci retracement tool from the swing low to the swing high. Only trade FVGs located below the 50% equilibrium level. [ 1 , 2 , 3 ] Order Block Alignment : The highest-probability FVGs rest directly above or inside a bullish Order Block (the last down-close candle before the mo...

Trading Patterns and plans

  A bull flag pattern is a powerful continuation chart pattern that signals a strong buying opportunity during an upward trend. It consists of a sharp price spike (the flagpole) followed by a brief, downward-sloping consolidation period (the flag) before the asset breaks out upward Identify the Pattern The Flagpole: Look for a sharp, near-vertical price surge on heavy trading volume. The Flag: Watch for a tight, downward-sloping channel forming a parallel rectangle. The Volume: Ensure volume dries up significantly during the flag formation. [ 1 , 2 , 3 , 4 , 5 ] Execute the Buy Strategy 1. Pinpoint the Entry Point Method A: Buy the exact moment the price breaks and closes above the upper resistance line of the flag. Method B: Wait for a retest of the broken resistance line to confirm it has flipped into support. [ 1 , 2 , 3 , 4 ] 2. Set the Stop-Loss [ 1 ] Conservative: Place your stop-loss order just below the lowest point of the flag structure. Aggressive: Place your st...