First Candle Rule, Fair Value Gap

Discover the 'First Candle Rule' strategy using SMC. Identify entries on 5-minute charts based on the first 30-minute candle's high/low and Fair Value Gaps.

Published · Updated · Methodology: SMC

Part of: Fair Value Gap (FVG)

  • Methodology: SMC
  • Content type: strategy
  • Timeframes: 30-minute, 5-minute
  • Markets: Not specified

Indicators used

  • Fair Value Gap (FVG)

Source video

Decoded from: I Only Use 1 Candle To Trade (That's It). by Casper SMC — watch the original

Key timestamps:

  • 0:08 - Introduction to First Candle Rule
  • 0:20 - Marking the first 30-minute candle
  • 0:28 - Dropping to 5-minute chart and waiting for interaction
  • 0:33 - Confirmation with Fair Value Gap
  • 0:44 - Stop loss placement
  • 0:47 - Take profit target

Strategy overview

A fair value gap (FVG) is the price imbalance left behind when a candle moves so quickly that one side of the market never transacts through the range — a void price often returns to fill. Casper SMC's video "I Only Use 1 Candle To Trade (That's It)." builds an entire intraday routine around a single reference point: the session's first 30-minute candle. Instead of reading a chart full of structure, the "First Candle Rule" reduces the day's map to that one candle's high and low and lets everything else follow from how price behaves around it.

The distinctive step is the wait. After marking the opening 30-minute candle, the approach drops to the 5-minute chart and does nothing until price comes back to interact with that marked range — the candle is treated as a level to be revisited, not a breakout to chase. The fair value gap enters at that moment of interaction, acting as the confirmation that the reaction is deliberate rather than a random touch. In effect, the 30-minute candle decides where to look and the 5-minute FVG decides when the setup is valid.

This pairing — a higher-timeframe anchor candle for context and a lower-timeframe imbalance for timing — is what separates the setup from a plain gap-fill trade, where the gap itself is the whole signal. The source video also covers where stops and targets sit relative to the marked candle, framing the method as a deliberately minimal alternative to indicator-heavy intraday systems.

Topics

first candle rule · fair value gap strategy · smc strategy · ict trading · trading strategy · 5 minute strategy · 30 minute strategy · price action strategy · tradingview strategy · intraday trading · pine script · day trading strategy · market structure · order blocks

Frequently asked questions

What is the First Candle Rule in this strategy?

It uses the session's first 30-minute candle as the single reference for the day — its high and low become the levels price is measured against, instead of relying on a full chart of structure or a stack of indicators.

How does the Fair Value Gap fit into the First Candle Rule?

Once price returns to interact with the marked 30-minute candle, a fair value gap on the 5-minute chart serves as the confirmation that the setup is valid — it times the entry rather than defining the reference level itself.

What timeframes does this approach use?

Two: the 30-minute chart to mark the opening candle and set the day's reference range, and the 5-minute chart to wait for interaction with that range and read the fair value gap for confirmation.

How can I test the First Candle Rule before trading it?

Backtest it on historical intraday data first. Strategy Decoder extracts the structure of strategies like this one from their source videos so you can evaluate the concept and test it 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.

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