Fair Value Gaps, Market Structure, and Areas of Interest

Summary

This chart indicator combines fair value gaps with a directional market-structure process. It identifies gaps using price relationships across three bars, tracks swing highs and lows as direction changes, and marks structural reversals when price breaks the tracked pivots. Bullish and bearish areas of interest are then formed from gap and pivot relationships around those breaks.

The indicator extends recent areas on the chart, can display volume accumulated across their formation bars, and removes zones when they overlap or are mitigated by later price movement. It also plots reflection levels from selected reference points, using a smoothed price measure to color them as support or resistance, and can mark session boundaries in a configurable timezone. These are visual analysis aids; the document supplies no entry, exit, or position-sizing rules, nor evidence that the marked zones predict future price behavior. Results depend on chart timeframe, market data, and the indicator’s structural definitions.

Key ideas

• Fair value gaps are identified from gaps between the current bar and prices two bars earlier, with a middle-bar close condition.
• The script tracks directional swings and uses pivot breaks to identify bullish or bearish structural changes.
• Areas of interest are drawn from qualifying gap and pivot relationships and may include formation-period volume.
• Zones are removed when later price action mitigates them or when they overlap with newer zones.
• Reflection levels and session boundary markers add context, but the indicator does not define a complete trading strategy.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.