Reading Initial Balance Breakouts with Auction States and Retests
Summary
This indicator frames intraday price action around an Initial Balance, the high and low formed during a configurable opening session. The user selects session hours and a timezone, then the script tracks how later auction windows interact with those boundaries. Its state logic distinguishes probes, acceptance above or below the range, failed expansions, two-sided rotation, continuation, rejection, and retests. These states feed dashboard labels for market regime, directional bias, phase, maturity, and signal quality, and can trigger alerts when key transitions occur.
The indicator also offers midpoint and range-extension reference levels, decision-candle highlighting, and an auction-window length setting. It can inspect lower-timeframe data to characterize ranges on charts above one minute. The accompanying code and dashboard descriptions explain the framework, not its predictive validity: no out-of-sample results or trading performance are supplied. The document explicitly distinguishes its cumulative pressure and conviction measures from order flow, volume pressure, and probability. Session and timezone settings must match the market being analyzed.
Key ideas
- The Initial Balance is defined by the high and low of a configurable opening session.
- Post-range price behavior is classified into acceptance, failure, rotation, continuation, rejection, and retest states.
- Dashboard outputs summarize regime, bias, phase, maturity, and a conviction-style quality measure.
- Range projections serve as reference levels for possible extension and are not guaranteed price targets.
- The indicator describes price-based auction behavior and does not establish predictive performance.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.