For a few months now, the same words keep coming up over and over on social media dedicated to the stock market: order block, fair value gap, liquidity, ICT. If you're just starting out, it sounds like a foreign language. In reality, these are simply ways of reading a chart. Used well, they can help you better understand market movements. Used poorly, they give the illusion of predicting everything. We explain them step by step, as if you were discovering the topic for the first time, with everyday images and no unnecessary jargon.
What exactly is "smart money"?
The starting idea is simple: in the markets, a large share of buy and sell orders comes from very large players — major banks, funds, institutions. This is what's called "smart money." The school of thought known as ICT (named after an American educator, "Inner Circle Trader") proposes identifying on charts the traces left by these big players.
One essential point, and we insist on it: this is an interpretation among others. No one can see with certainty who is buying or selling behind their screen. A zone on a chart does not "contain" an identified buyer; it just tells a plausible story about what might have happened. Keep this in mind before turning it into a religion. Believing that you "see" smart money for sure is the first trap — and the most costly.
The 4 words you come across everywhere
- Order block: a price zone from which a sharp and powerful move originated. The idea: large volumes were traded there, and the price could react there if news brings it back. To picture it, it's the last step back before taking a run-up to jump. If the market returns to this zone, some traders observe the reaction, without deciding anything in advance.
- Fair value gap (FVG): a "hole" left in the chart by a move that was too fast, when three candles follow one another without overlapping. It's an imbalance: the price moved so quickly that it skipped a floor. Some then wait for it to come fill this gap, like patching a pothole to drive on flat ground again. Be careful: a gap is often spotted after the fact, once the move is over.
- Liquidity and liquidity sweep: liquidity represents the zones where many pending orders are hidden — especially stop orders (safety nets that cut a position to limit damage), placed just above a high or below a low. A "sweep" is when the price comes to graze or exceed these levels to trigger these safety orders, before heading back in the other direction. Imagine a vacuum cleaner passing over a carpet: it picks up what's lying around, then stops.
- Break of structure / market structure: this is the way of naming the general trend (is the market going up or down?) by observing the sequence of highs and lows, and the moment when this structure breaks. A bit like the weather: we look at whether the pressure is rising or falling before imagining what comes next.
A concrete example, without jargon
Imagine a stock or an index that tops out several times below the same high, clearly visible to everyone. Many retail traders place their protective order just above it. The price rises, exceeds this high by a hair (this is the famous liquidity sweep), triggers these protections in a chain… then falls back immediately. In ICT vocabulary, we'd say that smart money went to "hunt liquidity." Put more simply: the market went to grab the most obvious orders before changing direction.
The observable fact is the same; only the way of telling the story changes. And that's the whole nuance: what matters isn't the theory, it's the concrete reading of the chart, session after session.
💡 Concrete case: the "I get it" trap
Let's take a numerical example, deliberately simple (orders of magnitude, to be checked according to your context). You have €10,000 in capital and you risk 1% per position, i.e. €100. You think you've spotted a "perfect order block" and you place your order. The market sweeps your zone, your stop is hit: you lose €100. You start over three times in the week on "obvious" setups: three stops, i.e. €300, which is 3% of your capital. On €100, that's €3 less — painless once, but repeated every week, it quickly eats into your capital.
The lesson isn't that the method is wrong: it's that spotting a zone is not a signal. Without an entry rule, without a calibrated position size, and without discipline, even a good chart reading turns into regular losses. This is exactly why we insist as much on risk management and framework as on "setups."
What we really take away from it (and our stated opinion)
These concepts have real merit: they force you to look at where the other players are — where the protective orders are, where the obvious zones are — rather than buying or selling with your eyes closed. It's a useful mental exercise.
But let's speak frankly. Most beginners who lose don't lose because they know ICT poorly: they lose because they stack concepts without a framework, jump from one method to another, and confuse "having an opinion on the market" with "having a plan." ICT vocabulary has become a sales language on social media: it impresses, it gives the impression of belonging to an inner circle. It's seductive, and that's precisely what should make you wary.
Our position is clear and stated: these tools are one language among others, not a revealed truth. Two people will rarely draw the same order block, and an FVG can be guessed after the fact on almost any chart. It's like seeing shapes in clouds: everyone finds what they're looking for. Subjectivity, in trading, is paid for in cash. This is not an opinion on a market or an asset — it's a judgment on teaching practices, and it is strictly educational.
How JARVIS METHOD approaches the subject
At JARVIS METHOD, we seek to replace visual impression with objective, quantified reference points. Rather than drawing zones freehand, our TradingView indicator relies on VWAP (the volume-weighted average price, i.e. the average price at which volumes were traded over a period) and its standard deviation bands. The notions of "expensive" or "cheap" then become measured, shared levels, no longer a simple impression. The idea of spotting extremes — at the heart of the "smart money" philosophy — fits into a structured framework.
The precise workings of the indicator and the rules of the method remain reserved for members: it's our expertise, and we prefer to teach it to you in a progressive path rather than dilute it in posts. You can go deeper into this framework in our complete training, or explore our dedicated guides to understand how these reference points fit with the reality of stock market sessions. Less storytelling, more clarity.
The traps to know before getting started
- Confusing concept and signal: spotting a zone is not an entry decision. You need a clear, written, tested rule.
- Confirmation bias: the more you want to see an order block, the more you'll see one. The chart doesn't "speak" on its own.
- Vocabulary overload: collecting ICT terms never replaces rigorous risk management.
- No journal: without a written record of your decisions and results, you repeat the same mistakes without knowing it.
- Emotion: the fear of missing a move and the fear of losing push you to do the opposite of what you had planned.
To go further
If these notions intrigue you, the most effective approach is to first learn to read a chart with solid reference points: VWAP, session markers to identify the openings of major stock exchanges, and rigorous management of your capital size. This is precisely the path we chart in our complete training, organized into progressive paths, with bootcamps, mentoring, and events to anchor what you've learned.
To track your progress, our member area provides you with a trading journal (screenshots, results, and a mini psychological test), an orientation test, progress tracking, and a "My Trading" hub with your statistics. On the discipline and mindset side, mindset coaching and the "My Form" section help you stay the course over time. The Telegram assistant delivers the day's plan, a market brief, and targeted reminders every morning. And if you want to broaden your horizon beyond active trading, our investment journal (/investir) covers stocks, ETFs, and crypto, with courses and a weekly report.
You can also consult our comparative directories of brokers and prop firms (with practical info such as withdrawal times), our daily blog, our "JARVIS Reads," and our glossary so you never get stuck on a word. The important thing isn't collecting complicated terms, but having a reading you know how to apply, calmly, to every session. Knowledge is built; it isn't improvised.
Educational content. Trading involves a risk of capital loss; this is neither investment advice nor tax advice, and past performance does not guarantee future results.