Simple FVGs and Breakout/Breakdown Order Blocks

Not a video about a groundbreaking concept or strategy...especially if you watch my streams regularly where I discuss them all the time. Loma and Mayne systems use them a lot too. But since it's a big part of my system, and there was no video from me on Whop on this topic, and some people study my content first without looking at Loma/Mayne so it had to be done.

So here is a video about how I look at FVGs (I also often call them "inefficiencies" or "single prints" too) and the very related breakout/breakdown order blocks. My definition is a bit more loose than what you may see elsewhere, but I like simplicity and it works just great for all practical purposes, I hope you enjoy this video.

Also copy pasting my notes here: How to define an FVG on the chart?

Using the formal definition, you could every time you have 3 candles of the same color, with a gap between the top wick of candle 1 and bottom wick of candle 3 in the bullish case, and the bottom wick of candle 1 and the top of candle 3 in the bearish case

But that's a bit too "textbook" for me, and only makes sense for very short-term FVGs where you assume resting limit orders were unchanged. When trading longer chop we'll look at FVGs that may be older and orders may have been adjusted in the meantime

I personally think that definition is a bit too restrictive, so to make it simpler, and also because these obvious liquidity pockets will also get hunted, I like to look at whatever looks like a "single print", ie: an area that hasn't been properly retested since the impulse. And I may even ignore some wicks. So yes my definition may vary a little bit from what you've seen from Mayne/Loma. The simple way to look at it for me is that very often I'll look at the "breakdown/breakout order block" and consider the entire impulse as an FVG.

I also includes the plain gaps on the charts on markets that don't trade 24/7 (tradfi). Even if you never traded tradfi, you know the infamous CME gaps on BTC since like 2018!

How to use it and what to pay attention to?

in a strong trend, this is where you expect your short-term retests, you wanna look for recent FVGs for entries, while looking at potential older FVGs on higher timeframes for targets.

we don't need to fully fill an FVG, especially the short-term ones when the trend is strong

the long-term ones, that get visited much later, I like them fully filled

when the momentum is strong, you want to expect potential liquidation/forced selling, which may very well overshoot through the FVG, so in these situations, you may not want to blindly bid FVGs on leverage!

just like many indicators/strategies, you want to be looking at multiple timeframes, the FVGs may look slightly different (see the AAVE example)