Displacement and Fair Value Gaps

Many FVG tools mark every three-candle gap, including the tiny ones that appear in quiet markets. This indicator starts from the candle that caused the gap. A gap is only kept when the middle candle was a real displacement candle: a large body compared with its range, and a range several times ATR.

What it shows
- Displacement candles outlined, with the ATR multiple printed ("2.1x").
- Bullish and bearish fair value gaps anchored on those candles: a box, an edge line on each side and a dotted 50% (CE) line.
- Mitigation tracking: choose Touch, CE (50%) or Full fill. Mitigated gaps turn grey or can be hidden.
- A small counter with the number of displacement candles and live gaps.
- Alerts when a new gap forms and when price closes back into a live gap.

How it calculates
- Displacement test: body at least 70% of the range, and range at least 1.5 x ATR(14) by default. By default ATR comes from the previous candle, so a big candle does not raise its own threshold.
- A gap exists only after the third candle has closed. Mitigation is checked on closed candles.
- Minimum gap size can be set in ATR (default 0.05 x ATR) or in points.

Forex and gold
All thresholds are ATR-relative, so EURUSD, GBPUSD, USDJPY and XAUUSD work with the defaults. On gold, M5 to H1 shows clear displacement. On M1 you may want 2.0 x ATR.

Inputs
Bars scanned. Displacement: body ratio, ATR period, ATR multiplier, prior-bar ATR.
FVG: only displacement candles with a gap, direction match, minimum gap (points / ATR), mitigation mode, extension.
Display options and colours. Alerts (new gap, retest, pop-up, sound, push).

Notes
- This indicator does not open, modify or close trades. It is an analysis tool and not financial advice. No result is guaranteed.

Questions and suggestions are welcome in the comments section of this product.