4-Hour Fair Value Gap Strategy for 5-Minute Trading Entries

The trading industry is about to hate me for this video because I'm about to give you the

simplest strategy in all of trading with no daily buyers, no complicated indicators,

just a simple proven strategy that's been used by over 40,000 traders to become consistently

profitable. And if that wasn't good enough, I'm going to give you a completely full free

PDF to this trading strategy in the pinned comment down below.

Now, the four-hour chart is really important. You need to use the four-hour chart for this

because this is a higher time frame which smart money traders are executing on. So get the

four-hour chart of whatever market you trade. And what you want to do is simply mark out the

most recent fair value gap that forms in price action. And you're done now at this point.

You're literally done on the four-hour chart because all we want to see is, and you can

almost see this in this bit of price action here, but we want to see price hit this four-hour

fair value gap on the lower time frames. And then we want to see what price does afterwards,

right? Does it shoot off? Does it break through the fair value gap or does it consolidate

and do nothing, right? So what we're going to do now, now that we've marked out the four-hour

fair value gap is we're going to wait for price to hit this fair value gap on the lower time

frames. And we're going to look for confirmation because remember, this is a bullish fair value

gap, right? This is a bullish fair value gap. So we want to see on the lower time frames,

is price actually bullish? Is it actually going to go up or is it going to consolidate or is it

going to be bearish? So what we're going to do now is we're going to get onto the five-minute

chart. Now in the PDF down below in the pin comment, it shows you the 15-minute chart because

the 15-minute chart is the easiest time frame. However, and this is like a little trading law,

the higher the time frame. So if you use the 15-minute chart, you're going to get a higher

win rate, but you're going to get way less setups. And similarly, if you use the one-minute

chart, you're going to get way more setups, almost a setup every single day, but you're going to have

a lower win rate. So it's almost a trade-off. So the five-minute charts in between, again,

you back test, you choose whichever one you think is best. But for this video,

we're going to use the five-minute chart. So now that we've gone below the four-hour chart,

we're no longer, you know, there's no higher time frame analysis. This is purely a scalping

and day trading strategy. At this point, a guy asked me, Hey Atif, can I use this for swing

trading? Absolutely. What you would do is you would use a daily chart to find a fair value gap,

and then you would look for your entry on the four-hour chart. So that's how you use it for

swing trading. But because we're on the lower timeframes now, we have to look for our entries

during a key time of day. And the three major sessions in, you know, all financial markets is

London, Asia, and New York. So if we look at this point right here in price action, can you see how

it's 5 p.m. Eastern? And again, my time is always New York time. Doesn't matter where you live in

the world. I live in the UK. I use New York time. It just keeps it simple for everyone, but

you'll notice this is not a key time of day, and this is really important, right?

We only want to look for our entries during a key time of day. So price hits this four-hour

fair value gap, but because it's not a key time of day, you can just look at, you know,

just look at price action. It just slowly consolidates and does nothing, right? And then

obviously during Asia session, we start to see some movement, but really during this London

session here, right? So this is London session, which is 2 a.m. till 5 a.m. Eastern. You can see

the market doesn't go anywhere random, right? Where does it go? It drops straight into the

fair value gap and it quickly and aggressively shoots off, right? Can you see that how price

drops into this four-hour fair value gap? It doesn't, and a lot of people ask me this, right?

It should not spend much time in this four-hour fair value gap, right? It doesn't come all the

way down here, consolidate for like, you know, a few hours and then slowly start to move off.

That would not be bullish at all, but can you see? I'm sure you would agree price just comes

into the fair value gap and quickly and aggressively shoots off, right? Setting

us up perfectly for New York session. So there's a lot, you know, obviously we can talk all day

about analysis, but again, this is a simple trading strategy and the whole point is video,

right? It's for you not to watch any more trading videos. Like literally you should get to the

point and no one's ever going to tell you this, but you should get to the point where you have

your trading strategy and you literally, as sad as it sounds, unsubscribe from me and every other

influencer, whatever you want to call them. Anyone who's interested in trading or anyone

who teaches trading, you want to unsubscribe from them once you've got your strategy and just master

it. So again, no one's ever going to tell you that, right? But that's just, um, that's just

where your boy is. The OG, right? I'm the, I'm the real guy here, but for this trading strategy,

what you want to do is, do you know how I said the four hour fair value gap was a bullish fair

value gap? You want to mark out the first bullish fair value gap that forms. And again, the PDF in

the pin comment explains this all for you in writing, right? This is just a video of me

showing you it. Um, but this is the fair value gap that forms. And I'm sure you would agree just

by looking at price action, right? We've got the four hour fair value gap. What does price do? It

comes straight into it. It leaves a massive fair value gap for a strength run. And then what does

price do? Right? Look at the time of day. This is New York session. What does price do? It retraces

into this fair value gap. Now, for those who don't know, whatever London session does. So obviously

this was like a fake move and then London session shoots off. New York tends to be a continuation of

what London does. So if London's bullish, New York nine times out of 10 is also likely to be bullish,

right? Just a little trading tip there for you. So what do we do for entries, right? So this is

more of a, you know, almost like a day trading sort of continuation, um, entry, but what we're

going to do for your entry, right? Is we're going to enter on this fair value gap, right? So we've

marked out the fair value gap. Your stop should always be at the low that forms the fair value

gap. Very simple, right? You don't have to go anything crazy. Now this is a fairly big,

um, moving price action. So your stop loss is fairly big. So this is, you know, when it comes

to it, I don't want to get too much into this cause I want it to be as simple as possible when

it comes to, you know, wider stop losses and stuff, you want your tape profit to be more

humble. I'd say, right. You don't want to go for some crazy tape profit. Um, but I'm going to show

you now what I always do. I always just aim for a simple three to one, right? And it's really

important that we realize for our fair value gap price hits it shoots off, leaves a new fair value

gap. We entered during a key time of day on the fair value gap stops at the low stop is always

fixed at the low, right? We always want to have our stop in a safe area. And then for our tape

profit, simply a three to one. Now, even with a three to one, this is 20 pips. And again, this is,

it's for, so if you look at the bottom of the charts here, I don't think I've ever said this

one, not on YouTube. Anyway, you see how it's Friday Mondays and Fridays tend to be pretty

small in price action, right? So the price section on Mondays and Fridays, it's not the best. You can

obviously make money from it, but it's not a huge move, right? It's not a huge move unless of course

you've got a news event then. Yeah, obviously, but it's normally not that big of a move. So what we

do here is we take out three to one and get out, right? This is what I do. However, I know a lot of

traders, a lot of my private students like to just target opposing liquidity, which let me just put

this back here. They target opposing liquidity, which you just about get away with here. You see

how it just wicks out. However, if you targeted list liquidity, let me mark this out for you.

And for those who don't know what liquidity is, it's simply a stop loss order. So every major high

and low in price action, that's going to be liquidity. And the higher, the higher the time

frame, the more significant as a liquidity is. But if you try to target this liquidity here,

you actually lose out on it. So I'm a big believer really. Most traders, 95% of traders should not

aim for more than the free risk reward ratio because a free risk reward ratio, 50% win rate.

And if you've got a hundred K funded account, if you get 10 trades a month and you've got a free

risk reward ratio and a 50% win rate, and you've got a hundred K funded account, you're going to,

let's say you lose half your trade, you're down five K, but you win half your trade. You're up

15 K that's 10 K a month or 100 K account with a 50% win rate, right? The free risk reward ratio.

Now I don't know about you, but hopefully this video wasn't that complicated. Pretty simple.

Mark out the four hour fair value gap, wait for price to hit the fair value gap, enter on the

fair value gap, try and get key time a day. And I can't say make money right on YouTube. You get

the point, right? And again, the PDF down below explains all for you. And if you want to see more

examples, go check out this playlist on screen now.