{"id":13758,"date":"2026-05-27T07:30:11","date_gmt":"2026-05-27T07:30:11","guid":{"rendered":"https:\/\/lemonn.co.in\/blog\/glossary\/fair-value-gap\/"},"modified":"2026-05-27T07:30:11","modified_gmt":"2026-05-27T07:30:11","slug":"fair-value-gap","status":"publish","type":"glossary","link":"https:\/\/lemonn.co.in\/blog\/glossary\/fair-value-gap\/","title":{"rendered":"Fair Value Gap: Meaning, How to Spot, and Use It"},"content":{"rendered":"

Fair Value<\/a> Gap: A Trader’s Guide to Smart Setups<\/h1>\n

A fair value gap is an unfilled space on a chart between three candles, where the market moved so fast that price skipped a price zone. Many traders use this gap as a potential support or resistance area. Spotting fair value gaps can help you find clean entries on intraday and swing trades.<\/p>\n

This guide explains what a fair value gap is, how to identify it, and how Indian traders can use it.<\/p>\n

What Is a Fair Value Gap?<\/h2>\n

A fair value gap (FVG) is a price area between the wicks of three conse<\/a>cutive candles that the market did not trade through. The middle candle moves strongly in one direction, creating an imbalance.<\/p>\n

The gap shows where buyers or sellers were missing. Many traders believe the market often returns to fill these gaps.<\/p>\n

How to Spot a Fair Value Gap<\/h2>\n

Look at three candles in a row:<\/p>\n

    \n
  1. The first candle has a high and a low<\/li>\n
  2. The second candle moves strongly, beyond the first candle’s range<\/li>\n
  3. The third candle does not overlap the first candle’s range<\/li>\n<\/ol>\n

    The space between the first candle’s high (or low) and the third candle’s low (or high) is the fair value gap.<\/p>\n

    Bullish<\/a> Fair Value Gap<\/h2>\n

    A bullish FVG forms when:<\/p>\n