1. The Advanced Logic Behind Order Blocks & Fair Value Gaps
📌 Order Blocks and Fair Value Gaps (FVGs) aren’t just trading setups—they are institutional footprints.
At this stage of your ICT Deluxe Edition journey, you must start viewing Order Blocks and FVGs as Smart Money trade execution zones, rather than simple trading tools.
🚀 By the end of this chapter, you will understand:
✔️ How institutions use Order Blocks to accumulate or distribute liquidity.
✔️ How Fair Value Gaps are engineered liquidity voids that institutions seek to fill.
✔️ How to identify high-probability institutional Order Blocks for trade execution.
✔️ How to combine FVGs and Order Blocks for sniper-like precision in trading.
This is Dave – No Nonsense Trader, and after this chapter, you’ll never look at Order Blocks and FVGs the same way again.
📌 Image Guide:
📷 Suggested Image: A multi-timeframe Order Block trading setup showing liquidity sweeps, FVG retests, and Smart Money positioning.
🎨 AI Prompt:
“Create a structured financial trading chart illustrating a multi-timeframe Order Block and Fair Value Gap trading setup. Highlight liquidity sweeps, institutional positioning, and trade execution zones. Use professional trading annotations.”
2. What Are Order Blocks & Why Do They Matter?
📌 Order Blocks are areas where institutions execute large buy or sell orders, leaving behind a signature in price action.
Characteristics of Institutional Order Blocks:
✔️ Last down candle before a bullish move (Bullish Order Block).
✔️ Last up candle before a bearish move (Bearish Order Block).
✔️ Validated when price returns and respects the Order Block level.
✔️ Often align with liquidity pools and Fair Value Gaps.
🔍 Example:
A retail trader sees a down candle as random noise, while an ICT trader knows it’s an institutional Order Block, where Smart Money executed large buy orders before moving price higherAll Transcripts.
This is why Dave – No Nonsense Trader always focuses on where Smart Money has executed, not where retail traders are reacting.
📌 Image Guide:
📷 Suggested Image: A trading chart showing a Bullish Order Block with Smart Money accumulation and liquidity sweeps.
🎨 AI Prompt:
“Create a structured trading chart illustrating a Bullish Order Block, highlighting Smart Money accumulation, liquidity sweeps, and institutional trade execution points. Use professional trading annotations.”
3. Understanding Fair Value Gaps (FVGs) – The Market’s Liquidity Voids
📌 Fair Value Gaps are price imbalances that institutions seek to fill before continuing price movement.
Key Features of FVGs:
✔️ Created when price moves aggressively in one direction without enough counter-liquidity.
✔️ Represent areas where Smart Money did not fully execute orders.
✔️ Act as magnets, pulling price back before the real trend continues.
✔️ Often align with Order Blocks for high-probability setups.
🔍 Example:
A trader sees a sudden gap in price and ignores it, while an ICT trader knows it’s a Fair Value Gap that Smart Money will likely revisit before continuing price movementAll Transcripts.
This is why Dave – No Nonsense Trader tracks every Fair Value Gap as an institutional footprint.
📌 Image Guide:
📷 Suggested Image: A trading chart highlighting a Fair Value Gap, showing price returning to fill the liquidity void before continuing.
🎨 AI Prompt:
“Create a structured trading chart illustrating a Fair Value Gap, showing price moving aggressively, leaving an imbalance, and later returning to fill the gap before continuing. Use professional trading annotations.”
4. How to Identify High-Probability Order Blocks for Trade Execution
📌 Not all Order Blocks are created equal—some are stronger than others.
How to Filter for High-Probability Order Blocks:
✔️ Must occur near liquidity pools (Buy-Side or Sell-Side Liquidity).
✔️ Must align with a Fair Value Gap for added confirmation.
✔️ Should result in a strong displacement (fast price movement).
✔️ Should be respected when price retraces back into it.
🔍 Example:
A trader waits for a Bullish Order Block + FVG confluence setup, instead of blindly entering on every Order Block.
This is why Dave – No Nonsense Trader only trades Order Blocks with multiple layers of confirmation.
📌 Image Guide:
📷 Suggested Image: A trading chart showing a high-probability Order Block trade setup with FVG confirmation.
🎨 AI Prompt:
“Create a structured trading chart illustrating a high-probability Order Block trade setup, showing confluence with a Fair Value Gap, liquidity sweeps, and institutional positioning. Use professional trading annotations.”
5. How to Combine Order Blocks & FVGs for Maximum Precision
📌 The most powerful ICT trade setups happen when an Order Block and FVG align.
How to Execute an Order Block + FVG Trade Setup:
✔️ Step 1: Identify an Order Block near liquidity.
✔️ Step 2: Look for a Fair Value Gap within or near the OB.
✔️ Step 3: Wait for price to return to the OB + FVG zone.
✔️ Step 4: Enter the trade only after price reacts at the OB.
🔍 Example:
A trader waits for price to return to a Bullish Order Block with a Fair Value Gap, confirming Smart Money interest before entering long.
This is how Dave – No Nonsense Trader ensures his entries are backed by institutional liquidity.
📌 Image Guide:
📷 Suggested Image: A full trade setup using an Order Block and Fair Value Gap combination.
🎨 AI Prompt:
“Create a structured trading chart illustrating a complete trade setup using an Order Block and Fair Value Gap combination. Highlight liquidity sweeps, confirmation signals, and institutional positioning. Use professional trading annotations.”
6. What’s Next?
🔥 In the next chapter, we’ll take it further. You’ll learn:
✅ How to execute trades with Kill Zone precision, timing entries like an institution.
✅ How to refine your trade timing using session-based liquidity cycles.
✅ How to avoid false signals by aligning time and price perfectly.
📌 Key Takeaways from This Chapter:
✅ Order Blocks are Smart Money execution zones, not just random candles.
✅ Fair Value Gaps reveal where liquidity is missing and where price will likely revisit.
✅ Combining Order Blocks and FVGs creates high-probability trade setups.
✅ Tracking these institutional footprints allows for sniper-like precision in trading.
📌 Next Up: Chapter Seven – Advanced Kill Zone Execution & Trade Timing Precision 🚀
🔥 You now understand how institutions execute orders—keep going!