Define the pattern precisely
Different traders use different labeling rules. State whether your definition uses candle wicks or bodies, which timeframe you are inspecting and when the pattern becomes eligible for review. Without a fixed definition, a backtest can quietly change from chart to chart.
The midpoint is a reference
In Valdy’s public commentary, the 50% line inside a fair value gap is used as a reference for interpreting price behavior. A close beyond it is described as a warning in that framework. This is a way to organize an observation, not an exchange rule or a promise of a reversal.
Context still matters
A highlighted rectangle does not describe the whole session. Record surrounding structure, the conditions before the move and the rule that would invalidate the idea. Do not assume that every marked gap will be filled or defended.
Test the definition, including failures
Save examples that meet the rule regardless of their outcome. Note ambiguous cases separately. Include costs and execution assumptions when evaluating any hypothetical strategy. A collection of successful screenshots cannot establish expected returns.
Source: Valdy’s public consequent encroachment note on X. Conceptual terminology can vary between educators.
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