LIQUIDITY VOIDS & GAPS

ICT traders sometimes use "liquidity void" and "Fair Value Gap" interchangeably, but they have distinct characteristics: FAIR VALUE GAP (FVG): A three-candle formation where the high of candle 1 does not overlap with the low of candle 3 (bullish FVG) or vice versa (bearish FVG). The gap represents the specific zone of price imbalance between two adjacent candles in the sequence. LIQUIDITY VOID: A larger zone where price moved so aggressively -- typically in a single large candle or a rapid sequence -- that an entire section of the chart was covered without any meaningful trading. Unlike an FVG, a liquidity void spans the entire body of the aggressive candle, not just the gap between adjacent candles. PRACTICAL DIFFERENCE: FVGs are more precisely defined and easier to identify -- they have clear upper and lower boundaries between two specific candles. Liquidity voids are more expansive -- the entire body of the displacement candle represents a zone of price inefficiency. Both types share the same core characteristic: price passed through them without adequate two-sided participation, and the algorithm will return to reprice them eventually.