30yr IB-Range High: Hold Short
Initial Balance (IB) Range is established by the first two brackets of the session, after the open. The daily IB Range is the range of the first hour (2×30 minutes) after the Open.
It’s High (IBH) and Low (IBL) may act as breakout levels and Support/Resistance levels until they are held.
It is very important to monitor the development of the IB during the first hour and how price react to its H/L, because this can provide valuable information about further price action of the day.
The simplest way to use this information is to look for either the IBH or the IBL after the 1st hour and see if it holds the price. If price is rejected at these levels, expect the same happen next time but look for a 1-2 tick violation of the IBH or IBL.
Similarly to any S/R setups, the validity of these levels should always be verified by other information (orderflow, price action).
- During the Open (A) period price ran up to a V-POC level and formed the high of the Initial Balance Range
- During the second 30 minute period (B) price was rejected when tested the high of period ‘A’, leaving the range of the Initial Balance range intact (no-expansion)
- During the next 30 minute period (C) price tested the IBH again and failed to breakout (1 tick)
- Price retraced back to the high of the night session
- On the Footprint chart it can be clearly seen that sellers agressively held short/absorbed buying at the IBH and there were virtually no buying activity above this level. Finally around 9:45 agressive selling drove ZB down 6 ticks without having any by agressively selling without any significant size traded at the Ask.