Volume and Gap Imbalance | The explanation

A FVG can indicate that IPDA is in a hurry to move price in one direction over another. This is an algorithmic footprint that we can see in price action. ICT often uses the analogy of an elephant stepping into a children's pool. Since the size and mass of the elephant's foot is so large, we will of course see a displacement of water. ICT uses this analogy to draw a comparison to larger institutions with 'deep pockets' entering the marketplace. Like everything with ICT concepts, there are of course caveats to when and where we can expect displacement to occur and when to trust it, but keeping this analogy in mind at key support/ resistance levels will serve you well.

A Volume Imbalance (V.I.) occurs when there is an area of price that has been left without a candle body. There is up-and-down movement in the overlapping of the wicks, however since the bulk of the volume is in the body of the candle, we dub this a Volume Imbalance.

A Gap Imbalance (G.I) occurs when an area of price is void of any price delivery including wick movement. This is a real price gap.