# Trading confluences, a practical framework for filtering high-probability setups

Learn how to combine liquidity, fair value gaps, inverse FVGs, equal highs/lows and breaks of structure into a repeatable trading confluence checklist.

Source: https://petrocode.shop/trading-confluences-a-practical/ · based on the channel [TJR](https://www.youtube.com/channel/UCGHBUXjDCeiIXNdKR0HUZnA) · Video: [Learn Every Trading Confluence In 18 Minutes](https://www.youtube.com/watch?v=TYbpk7WogHI) · 2026-10-18

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## Key takeaways

- A confluence is any independent piece of evidence that supports a trade idea; stacking them filters low-quality setups.
- TJR's 18-minute breakdown covers liquidity, fair value gaps, inverse FVGs, equal highs/lows and breaks of structure.
- Liquidity pools sit above equal highs and below equal lows, where stop orders and pending orders cluster.
- A fair value gap is a three-candle imbalance; an inverse FVG flips polarity after price trades through it.
- More confluences are not automatically better: each must add independent information to the same thesis.

Trading confluences are independent pieces of evidence — such as liquidity, fair value gaps, breaks of structure or equal highs and lows — that line up to support one trade idea. Instead of acting on a single signal, a trader waits for several of these factors to agree, which filters out weaker setups and improves the risk-to-reward profile of each entry. TJR's video "Learn Every Trading Confluence In 18 Minutes" walks through the main building blocks of this approach, and the free trader blueprint at [go.tjrtrades.com/blueprint-nviugv1](https://go.tjrtrades.com/blueprint-nviugv1) expands the same framework into a full routine.

## What a trading confluence actually is

A trading confluence is a second, third or fourth reason to take a trade that does not depend on the first reason. If a fair value gap and a break of structure both point to the same direction, that is a confluence; if two indicators are derived from the same price data and always agree, that is not. The practical value comes from independence: each factor should be able to fail on its own without automatically invalidating the others. TJR's breakdown treats liquidity, imbalances, structure and equal highs/lows as separate lenses, and the trader's job is to see where they overlap. This is why simply piling on indicators often makes results worse — correlated tools create the illusion of confirmation without adding information.

## The core confluences covered in the 18-minute breakdown

The video organises the main concepts a discretionary price-action trader uses, and each one answers a different question about the chart. Liquidity asks where other traders' orders are resting; fair value gaps ask where price moved too fast and left an imbalance; inverse fair value gaps ask whether a former imbalance has flipped its role; equal highs and lows ask where obvious stop levels sit; breaks of structure ask whether the market has changed direction. Used together, they describe both the likely destination of price and the likely reaction level along the way.

1. **Liquidity** — clusters of stop-loss and pending orders above equal highs or below equal lows, which price often seeks before reversing.
2. **Fair value gap (FVG)** — a three-candle formation where the wicks of the first and third candle do not overlap, leaving a price range that was traded through with little two-sided participation.
3. **Inverse fair value gap (IFVG)** — a fair value gap that price trades through completely and then respects from the other side, turning former support into resistance or vice versa.
4. **Equal highs and equal lows** — two or more highs or lows at nearly the same price, which create an obvious liquidity pool and a magnet for price.
5. **Break of structure (BOS)** — a close beyond a prior swing high or low that signals a shift in the active market direction.

## How to combine liquidity and fair value gaps

Liquidity and fair value gaps work best as a destination-and-route pair: liquidity tells you where price may be drawn, and the fair value gap tells you where it may pause or reverse on the way. A common sequence is price sweeping an equal-high liquidity pool, then displacing back through a fair value gap, which leaves an imbalance that can act as an entry zone on the retracement. The confluence is stronger when the fair value gap sits between the current price and the liquidity target, because the trade has both a reason to enter and a reason for price to continue. Traders who use this pairing typically wait for the sweep to complete rather than entering into the liquidity level itself, since the sweep is the event that often traps late breakout buyers or sellers.

## Fair value gaps and inverse fair value gaps in practice

A fair value gap marks a range where price moved so quickly that one side of the market did not participate; an inverse fair value gap marks the moment that range stops working as support or resistance and starts working in the opposite role. In practice, a bullish fair value gap that is later traded through and then retested from above becomes a bearish inverse fair value gap, and the same logic applies in reverse. The useful confluence is not the gap alone but the reaction: a retest that rejects cleanly from the inverted zone, ideally with a break of structure in the same direction, gives a defined invalidation point just beyond the zone. This is also why gaps that are never reclaimed tend to remain untested for longer — the market has not yet shown which side is in control.

## Structure, equal highs and lows, and the risk of over-stacking

Breaks of structure and equal highs/lows are the context layer: structure tells you the direction of the active leg, and equal highs or lows tell you where the next liquidity event is likely to occur. A long setup is cleaner when a break of structure to the upside has already occurred, an equal-low liquidity pool below has been swept, and a fair value gap above the current price has not yet been filled. The main risk is over-stacking: adding five confluences that all describe the same thing creates false confidence and oversized positions. A workable rule is to require two or three independent factors, define the invalidation level before entry, and size the position from that level rather than from the number of confluences counted.

## Common questions traders raise about confluence trading

Traders often ask which confluence matters most, and the honest answer is that it depends on the strategy — a scalper on a lower timeframe may weight liquidity sweeps more heavily, while a swing trader may care more about structure and unfilled gaps. Another frequent concern is that confluence trading feels slow, because most charts do not offer a clean overlap; that is the point, since the filter is supposed to reduce the number of trades. A third question is whether confluences work in crypto and forex as well as in futures; the concepts are market-agnostic because they describe order flow and liquidity, but the exact parameters such as session timing and gap size need to be adapted to each market's volatility. Finally, many traders ask how long it takes to become consistent, and the realistic answer is that it is a skill built through deliberate screen time and journaling, not a fixed number of weeks.

## Useful links

- Trader blueprint: https://go.tjrtrades.com/blueprint-nviugv1
- Indicators used in the breakdown: https://go.tjrtrades.com/indicators-6qf6zb4
- Funded account raffle: https://form.tjrtrades.com/funded-contest
- Alpha Futures funded accounts (10% off): https://app.alpha-futures.com/signup/TJR/
- Lucid Trading (40% off): https://lucidtrading.com/ref/TJR/

## Final takeaway

Trading confluences are a filtering tool, not a prediction machine: they help you say no to mediocre setups and yes to trades where several independent factors agree. The five building blocks TJR covers — liquidity, fair value gaps, inverse fair value gaps, equal highs and lows, and breaks of structure — are enough to build a repeatable checklist without adding more indicators. The discipline is in requiring independence, defining invalidation before entry, and accepting that fewer, better trades are the goal. For a structured version of the same framework, start with the [TJR trader blueprint](https://go.tjrtrades.com/blueprint-nviugv1) and review the channel's full breakdown for context.

## Questions & answers

**Which trading confluence matters most?**

There is no universal ranking, because the weight of each confluence depends on the strategy and timeframe. A lower-timeframe scalper usually prioritises liquidity sweeps and fair value gaps, while a swing trader leans more on breaks of structure and unfilled imbalances. The practical rule is to pick two or three factors that fit your plan and test them consistently.

**Do confluences work in crypto and forex, or only in futures?**

The concepts are market-agnostic because they describe liquidity and order flow rather than a specific instrument. What changes is calibration: session timing, typical gap size and volatility differ between crypto, forex and index futures, so the same checklist needs adjusted parameters for each market.

**Why do most of my charts show no clean confluence?**

Most of the time the factors do not overlap, and that is the filter working as intended. Confluence trading is designed to reduce the number of trades, so waiting for a clean alignment is part of the process rather than a sign that something is wrong.

**How long does it take to become consistent with confluence trading?**

There is no fixed timeline, because consistency comes from deliberate screen time, journaling and reviewing mistakes rather than from a set number of weeks. Traders who treat it as a skill-building process, with small risk and recorded trades, tend to progress faster than those chasing a quick result.