Liquidity void in gold trading

A liquidity void is a range of prices that the market moved through very quickly, usually in one or a few large candles, leaving little or no trading at the prices inside it. It is a larger-scale relative of the fair value gap: where an FVG is a three-candle gap, a void can span several candles of one-way movement.

How it applies to gold trading

Gold creates voids on news releases, at session opens and during sharp liquidation moves. The ICT reading is that such areas are inefficient and that price tends to return into them later to rebalance, often filling at least part of the void before continuing. Traders use voids as targets (price moving back into a void above or below) and as zones to watch for entries when price returns.

The same thinness that created the void can make price move fast through it again, so reactions inside a void are less dependable than at a defined order block or the edge of the void.

Worked example

Example (hypothetical numbers): on an NFP release gold drops from 4,030 to 3,995 in two 5-minute candles with almost no overlap. Later in the session gold rallies back into the void, reaching 4,016 before stalling. A trader targeting a 50% refill of the void ($17.50 above the low, about 4,012.50) took profit on a long from 3,998.

A common mistake

Expecting every void to fill completely and immediately. Some stay open for days or never fully fill.

See also: Fair value gap, Imbalance, Displacement, News spike.

Frequently asked questions