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Glossary

Displacement

LiquidityLevels Glossary

Displacement is a strong, fast, one-directional price move — a run of large-bodied candles with little overlap between them — that traders read as a signal of genuine, real shift in control between buyers and sellers, rather than the normal back-and-forth of a range. The speed and size of the move is the point: it suggests real size traded through quickly enough that price didn't have time to trade both ways at every level along the way.

Displacement is the move that actually leaves a fair value gap behind — the imbalance is a direct byproduct of price moving too fast to fill in every level. The candle right before displacement starts is what traders mark as an order block. All three concepts are describing the same event from different angles: the order block is where it started, displacement is the move itself, and the fair value gap is the imbalance it left behind.

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← All terms Fair Value Gap → Order Block →