Trading
Imbalance
An area where price moved too quickly, leaving gaps to fill.
Full Definition
An imbalance in trading refers to an area where aggressive buying or selling created rapid price movement without adequate two-way trading. These zones often appear as Fair Value Gaps or large candles with minimal overlap. Price tends to return to these areas to 'rebalance' before continuing.
Example
A news announcement causes price to spike 50 pips instantly. This imbalanced move often sees a pullback to fill the gap before the trend resumes.
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