# ICT Fair Value Gaps (FVG): BISI, SIBI and CE · DT Academy > BISI and SIBI, consequent encroachment, volume imbalance, inversion gaps and balanced price ranges: ICT's fair value gap toolkit as testable rules. [Back to ICT Concepts](https://www.thedtterminal.com/academy/courses/ict-concepts) Lesson 6Fair value gaps the ICT way Chapters done # Fair value gaps the ICT way Lesson 06 · 5 min read · By DT Terminal BISI and SIBI, consequent encroachment as a rule on candle bodies, gaps as both targets and entries, volume imbalance, inversion gaps and the balanced price range. Unlock the full lesson in the app Worked examples, the quiz and the interactive tools are in the app. Free account. [Continue in the app, free](https://www.thedtterminal.com/login?signup=true&redirect=%2Fjournal%2Facademy%2Fict-fair-value-gaps) Chapter 1 of 6 ## BISI and SIBI [Day 12](https://www.thedtterminal.com/academy/fair-value-gaps) taught the three candle pattern. ICT names the two directions: - **BISI**, Buyside Imbalance Sellside Inefficiency: a bullish gap, read as support on a retracement. - **SIBI**, Sellside Imbalance Buyside Inefficiency: a bearish gap, read as resistance. ICT marks a gap from candle 1's wick to candle 3's wick. Some traders use bodies; **this lesson uses wicks**. Raw three candle gaps print all the time. ICT focuses on gaps left by **displacement** that broke structure or followed a sweep, and on gaps inside the windows from [The ICT clock](https://www.thedtterminal.com/academy/ict-sessions-and-killzones). **Filter before you mark.** A gap with **no displacement behind it** is one of hundreds on the chart. **Go deeper** Session variants also exist, such as the first gap after the 09:30 New York index open. Chapter 2 of 6 ## Consequent encroachment: the decision line **Consequent encroachment** (CE) is the gap's 50% line. ICT uses it as a decision line, and **only candle bodies count**: - **Held:** no body closes beyond CE. Wicks past it are fine. - **Weakened:** a body closes beyond CE, still inside the gap. - **Invalid:** a body closes beyond the far edge. Fair value gaps ### Held, weakened and invalid, BISI and SIBI - Fair value gap - Consequent encroachment, 50% BISI bullish: candle 3 low above candle 1 high SIBI bearish: candle 3 high below candle 1 low Held a wick past CE, but the body closes above it Weakened a body closes beyond CE, inside the gap Invalid a body closes beyond the far edge **Watch the bodies.** The held row has a wick past CE on purpose. The SIBI column is the BISI one turned upside down. Schematic candles, not market data. Worked example ### Example 01: `EURUSD` H1: a BISI that held at CE The worked example, with every number walked through, is in the app. [Continue in the app, free](https://www.thedtterminal.com/login?signup=true&redirect=%2Fjournal%2Facademy%2Fict-fair-value-gaps%3Fsection%3Dconsequent-encroachment%23consequent-encroachment) Free account **Go deeper** Times are New York time, EDT. The 11:00 candle opens at 1.09050 and closes at 1.09480. Candle 1's high and candle 3's low leave the BISI. Had the 15:00 body closed at 1.09090, below the gap, the BISI would be invalid and an inversion candidate. Chapter 3 of 6 ## A target and an entry In ICT an unfilled gap is also **internal range liquidity**: a target price may be drawn to, as in [Liquidity the ICT way](https://www.thedtterminal.com/academy/ict-liquidity). As an entry, it is usually written as: - **Only after a sweep and a market structure shift.** - A limit at the near edge or CE, in the gap's direction. - The stop **beyond the displacement's swing**, not just beyond the gap. - The target at opposing liquidity. **No peer-reviewed study** shows these gaps are revisited more than chance, or that CE works as a decision level. Test each rule. Tag gap trades by what the gap had done Tag every gap trade BISI or SIBI, then fresh, past CE or inverted, and filter by those tags. **Go deeper** The Intensive used gaps mainly as entries; ICT also uses them as targets. Traders rank fresh gaps first, then gaps in a killzone, then gaps that agree with the higher timeframe draw. **Many gaps never fill.** Once you have a few dozen tagged trades, filter by those tags and by Outcome to compare them. Chapter 4 of 6 ## Volume imbalance A **volume imbalance** is a gap between two bodies only. Two candles in a row whose bodies do not overlap, while their wicks do. It is smaller than a fair value gap, and it shows up most where markets open with a jump, such as index opens. Fair value gaps ### A fair value gap next to a volume imbalance - Fair value gap - Volume imbalance Fair value gap wicks of candles 1 and 3 do not overlap Volume imbalance two bodies do not overlap; the wicks do Bullish in a move up A bullish fair value gap: candle 3 low sits above candle 1 high, so there is a gap between their wicks. A bullish volume imbalance: the second candle opens above the first candle close, so the bodies do not touch, but the second candle wick reaches back below the first candle top. Bearish the same, upside down A bearish fair value gap: candle 3 high sits below candle 1 low. A bearish volume imbalance: the second candle opens below the first candle close, but its wick reaches back above the first candle bottom. **Compare across.** The fair value gap is between wicks three candles apart. The volume imbalance is between two neighbouring bodies. Schematic candles, not market data. Chapter 5 of 6 ## Inversion: a body close through The [Intensive's inverted gap](https://www.thedtterminal.com/academy/fair-value-gaps#inverted) becomes the **inversion fair value gap** (IFVG): a failed BISI is used as resistance, a failed SIBI as support. The confirmation is a **candle body closing beyond the far edge**. **A wick through it is not an inversion.** Worked example ### Example 02: `NAS100` M5: a BISI that inverts The worked example, with every number walked through, is in the app. [Continue in the app, free](https://www.thedtterminal.com/login?signup=true&redirect=%2Fjournal%2Facademy%2Fict-fair-value-gaps%3Fsection%3Dinversion%23inversion) Free account **The plan in full** Times are New York time. The 10:40 body closes at 18,201. A plan written on it: a short limit at 18,212 in the lower part of the old gap, a stop at 18,232 above it (20 points), and the session low at 18,160 as the target (52 points, 2.6R). Price reaches it by 11:30. Chapter 6 of 6 ## Balanced price range A **balanced price range** (BPR) forms when a sharp move and a sharp reversal pass through the same prices, leaving a SIBI and a BISI that overlap. **Mark only the overlap.** **Drawing the whole span of both gaps** is the common mistake. Fair value gaps ### Mark the overlap, not the union - The two gaps - Balanced price range Balanced price range a SIBI on the way down, a BISI on the way back up The overlap only the prices both gaps share Not the union both gaps together is too wide The same drop and rally, with one box drawn over both gaps together. That is the common mistake: the balanced price range is the overlap, not the union. Schematic candles, not market data. Grade gaps in the backtester first Replay a few weeks of `NAS100` on M5. Mark every displacement gap with the rectangle tool and draw its CE. Before you press play, write held, weakened or invalid for the next return, then check how often each one happened. 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