Fair Value Gap

Learn the Fair Value Gap (FVG) concept in Smart Money Concepts (SMC) to identify market inefficiencies and potential trade setups for various markets and timefr

Published · Updated · Methodology: SMC

Part of: Fair Value Gap (FVG)

  • Methodology: SMC
  • Content type: educational

Indicators used

  • Fair Value Gap (FVG)

Source video

Decoded from: Fair Value Gap Simplified - Smart Money Course by Smart Risk — watch the original

Strategy overview

A fair value gap (FVG) is the price imbalance left when a fast, one-sided move skips levels that both buyers and sellers would normally trade at, leaving a gap the market often returns to fill. This entry decodes Smart Risk's "Fair Value Gap Simplified", a lesson drawn from the channel's Smart Money Course, and its angle lives in that title: the concept is deliberately stripped down so a newer trader can recognize a gap on the chart before worrying about how to trade it.

That course-lesson framing is what sets this apart from the way the FVG usually shows up online. Most treatments introduce the gap already wired into something larger — a directional day-trading plan, a session-liquidity sweep, a premium/discount matrix. Here the gap is the subject itself, taught as one of the foundational building blocks of Smart Money Concepts before those bigger structures get layered on top. The emphasis is clarity over complexity: what forms the imbalance, why it draws price back, and how to spot it cleanly on a candle chart.

Because it is positioned as an introductory module rather than a mechanical setup, the real takeaway is a clean mental model of the fair value gap — the kind of foundation the rest of a Smart Money Concepts education builds on. Turning that recognition into actual trades still means pairing the gap with market-structure reading, a directional bias, and defined risk, which is where the related FVG strategies on this concept hub pick up.

Topics

fair value gap · fvg trading strategy · smart money concepts · smc strategy · price action · trading strategy · market inefficiencies · tradingview strategy · pine script

Frequently asked questions

What is a fair value gap (FVG)?

A fair value gap is a price imbalance created when a strong, fast move leaves a range of skipped prices — a gap between candles that the market frequently revisits later to rebalance before continuing.

What does "simplified" mean in this Smart Risk video?

It is a lesson from Smart Risk's Smart Money Course that isolates the fair value gap and explains it on its own, rather than inside a larger system — aimed at helping newer traders recognize the pattern clearly before combining it with other Smart Money Concepts.

Is the fair value gap a complete trading strategy on its own?

No. The FVG is a building block, not a full strategy. By itself it only marks an imbalance; to trade it you still need market-structure context, a directional bias, and risk rules, which is why it is usually taught early in a Smart Money curriculum.

How can I study the fair value gap alongside other Smart Money concepts?

Strategy Decoder catalogs FVG-based strategies extracted from different video sources, so you can compare how various traders define and apply the gap and then test the ideas on TradingView.

About this strategy page

This trading strategy was decoded by Strategy Decoder's AI from a public YouTube trading video and turned into a structured, reviewable specification. In the interactive app this page shows the full entry and exit logic, risk management settings, the indicators involved with their parameters, AlgoWizard-compatible logic and a Pine Script export ready for TradingView backtesting — plus an automated backtest verdict when one has been computed for this strategy.

Strategy Decoder catalogs 2,229 decoded strategies. Each one is extracted with confidence scoring, cross-linked to the indicators it uses, and kept up to date as new videos are processed daily. Load this page with JavaScript enabled to use the interactive tools, or start from the strategy explorer to filter by methodology, market and timeframe.

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