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Breakaway gap and the fair value gap

A breakaway gap is the term for a gap that opens as price leaves a trading range. A fair value gap is a three-candle pattern that can appear inside such a move, and the two are not the same thing.

By Michael H.. Last updated . Corrections log

The short answer

A breakaway gap comes from classical charting: price has been moving sideways, then jumps out of the range and leaves empty space between one candle and the next. It is named for what price was doing when it formed, which is leaving a range.

A fair value gap is named for its shape. It needs three candles whose first and third wicks do not overlap, and says nothing about what came before. A strong move out of a range often leaves one, so a breakaway can contain a fair value gap. A fair value gap inside a quiet stretch is not a breakaway.

Why a fair value gap is emptyOn the left, three candles with a large up candle between them leave a gap. On the right, a bar chart of how many trades happened at each price: many outside the gap, very few inside it.1. Price moves fast123the gapOne side dominates and price jumps.2. Few trades happen inside the gapmany trades at the other pricesfew trades hereTrades done at each price (teaching units).The empty stretch is what traders mark.
Diagram, not a market chart. The usual explanation, offered as a way to think about the pattern and not a proven law of markets.

A gap price did not come back to

USDJPY15 minute3 bullish 3 bearish ยท 6 gaps by the rule
156.500157.000157.500158.00006:0008:0010:0012:0014:0016:00123456
  1. 1Bullish157.049 to 157.239formed 07:45 UTCTraded through at 14:45 UTC
  2. 2Bullish157.524 to 157.659formed 08:30 UTCTraded through at 14:45 UTC
  3. 3Bullish157.694 to 157.727formed 08:45 UTCTraded through at 09:00 UTC
  4. 4Bearish157.745 to 157.795formed 13:15 UTCTraded through at 13:15 UTC
  5. 5Bearish157.781 to 157.790formed 15:00 UTCNot revisited by 18:00 UTC
  6. 6Bearish157.508 to 157.744formed 15:15 UTCNot revisited by 18:00 UTC
USDJPY, 18 September 2026, 06:00 to 18:00 UTC. Real candles: Dukascopy 15-minute candles, read 2026-10-02. Fair value gap by the three-candle wick rule, no minimum size. Each box runs from its gap until a later candle trades through its far edge, or to the end of the chart.

USDJPY, 18 September 2026, 06:00 to 18:00 UTC. The plain rule finds 6 gaps in this window, and price had not returned to 2 of them by the end. The widest of those formed when the candle closing at 15:00 UTC completed, and measures 0.236 in price.

Gaps that price does not return to are what people describe when they talk about a breakaway: the move left and did not look back. This page does not claim that this gap was a breakaway, because that label depends on the range before it, and the rule here does not read ranges. The window was chosen because it shows unvisited gaps clearly.

What the sample counts

Of 11,764 gaps with at least 8 candles left in their window, 8,872 of 11,764 (75%) were touched within 120 minutes. The rest were not revisited in that time.

Counts for 1,500 windows, one sample and one size-free rule. They are not a chance for the next gap. The method is on the examples page.

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