OB-MSS-FVG Strategy

Strategy Explanation:

Identify the Order Block

Look for the last bearish (red) candle before a sustained rally. This candle represents the Order Block, signaling institutional buying/selling activity.

Confirm the Order Block is validated by a liquidity sweep (price briefly wicks into a prior swing high/low to trigger stop orders before reversing).

Confirm Market Structure Shift (MSS)

A ChoCh (Change of Character) occurs when price breaks a prior swing high in a downtrend (or low in an uptrend).

Validate with upward displacement: A strong bullish candle closing above the Order Block, confirming trend reversal.

Locate High-Probability FVGs

FVG Definition: A 3-candle pattern where the middle candle gaps above/below adjacent candles (e.g., bullish FVG in a downtrend).

Conditions for FVG:
a. Unmitigated: Price hasn’t retested the FVG zone.
b. No close below: If tested, price should not close below the FVG (bullish confirmation).
c. Confluence: FVG aligns with a key level (e.g., trendline, Order Block, or Fibonacci retracement).
d. Prioritize farthest FVG: The earliest FVG after the ChoCh is stronger (less likely to be a retracement trap).
e. Fibonacci Filter: Draw Fib (0–100%) from the swing low to high of the rally. Strong FVGs lie between 0–50%; avoid those above 50%.
f. BOS/ChoCH Confirmation: FVG must form after a Break of Structure (BOS) or ChoCh, alongside a liquidity sweep (e.g., stop runs).

Entry, Stop Loss, and Take Profit

Entry: Enter long when price retests the FVG (preferably in the 0–50% Fib zone) and shows rejection (e.g., bullish pin bar, engulfing).

Stop Loss: Place below the FVG’s low or the Order Block’s low, whichever is lower.

Take Profit: Target the next liquidity zone (prior swing high) or use a trailing stop after a BOS.

Example Scenario

Downtrend: Price sweeps liquidity below a swing low.

MSS: Price rallies, breaks the prior swing high (ChoCh).

FVG Formation: A bullish FVG appears during the rally.

Fib Confluence: FVG lies between 0–50% of the rally’s Fib retracement.

Entry: Price retraces to FVG, bounces with a bullish candle.

Exit: Profit at next swing high or liquidity pool.