Smart Money / ICT
Order Block + Fair Value Gap
Stack two SMC concepts for higher-probability entries.
Order blocks and fair value gaps are strongest together. When an unmitigated order block overlaps an unfilled fair value gap, you have a high-confluence zone where price is more likely to react.
How it works
After a structure-breaking move, mark the originating order block and the fair value gap inside the impulse. When price retraces into the overlap of the two, you have your entry zone, aligned with the higher-timeframe bias set by the break of structure.
Entry rules
- ▸Identify a break of structure and the order block + fair value gap it leaves.
- ▸Wait for price to retrace into the overlap of the two zones.
- ▸Enter in the direction of the structural bias.
Exit & risk
- ▸Stop beyond the far edge of the order block.
- ▸Target the next liquidity pool or structural level.
- ▸Invalidate if the order block is decisively broken.
Best for
Trending markets with clean structure. Confluence reduces false signals but also reduces frequency, quality over quantity.
Build this strategy in Algovex
Every component of this strategy is a node in Algovex — drop them on the canvas, connect the logic, backtest on a real engine, and export to code. No programming required.
Key terms
Frequently asked questions
Why combine order blocks and fair value gaps?
Each is a zone where price tends to react; where they overlap, the confluence is stronger, improving the odds of a clean reaction. Algovex detects both as nodes so you can require the overlap in a backtested strategy.