FVG Inducement, Target, Daily bias
Last updated
Last updated
What is this about: This shows how an FVG can cause an inducement (how it can attract price towards it).
Example 1:
Here, we can see a bullish FVG which caused an up movement out of the shelf. We can see that price came back and just hit the upper quarter of the FVG. This means that it is attracting price to reach the FVG again and close the gap.
Here we can see that it did come back the FVG and go up.
Example 2:Here, we can see a bearish FVG which caused a down movement out of a shelf (the shelf is outside of the picture). We can see that price came back and visited the FVG. Now, it could:- go back to close the gap and resume the downtrend- just drop- drop down to the Discount zone which might make it go up to break above the FVG- form a micro pullback and then go up to the Order Block (the pull back should be a shallow one).
Here, we see what actually happened. It broke above the FVG and reached the Order Block which made it come back down.
What is this about: This shows how you can use FVG as targets for trades.In case of a buy: Here, we see that we have a buy setup (because we have a Break of Structure and we are expecting price to come back down to the Order Block and reject off of it).We are going to take a buy at the bullish OB.Set your TP at the top of the FVG. The FVG should overlap with the Premium Zone.
In case of a sell: Here we see a bullish FVG. Let’s say that we have entry conditions for a sell and we take the trade. We will also make sure that the FVG overlaps with the Discount zone (which it did). Our TP would be at the bottom of the FVG.
What is this about: This shows how to use FVGs to predict the trend on the Daily timeframe.In case of a bullish bias: Go to the Daily timeframe and look for a bullish FVG. Wait for a low to reach below the FVG. Then expect the next day/s to be bullish (which happened here).
In case of a bearish bias: Go to the Daily timeframe and look for a bearish FVG. Wait for a high to reach above the FVG. Then expect the next day/s to be bearish (which happened here).
As the days go by, the probability of the bias decreases. Therefore, the day immediately following the price reaching the FVG has the highest probability.
How this can be programmed:
To find a bullish bias: Find the latest bullish FVG on the Daily timeframe. Find the first low which was below/equal to the bottom of the FVG. Then expect the next day (the next candle) to be bullish.
To find a bearish bias: Find the latest bearish FVG on the Daily timeframe. Find the first high which was above/equal to the top of the FVG. Then expect the next day (the next candle) to be bearish.
