Initial Balance Day Type Screen
The first hour draws the initial balance, and everything the day does after that is measured against it. Enter the IB high and low, the day's high and low so far and the last price, and the screen gives you the range extension on each side in IB units, the Market Profile day type the session is shaping into, and the one thing a range trader should be doing with the IB edges right now: fading them, buying the pullback into them, or leaving them alone. The day type table from Dalton's Mind Over Markets (1990) sits underneath with the IB relationship and the range play for each, and the row you're in lights up.
IB is the first hour (2 thirty-minute profile periods). Day high and low include the IB. Minutes since the IB closed only shapes the wording: a neutral day at 11:00 and one at 15:30 aren't the same trade.
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Enter the IB and the day so far. The day type and the play update as you type.
Day types by their initial balance
Dalton's day types, read through the IB. The extension column is how far the day's range has pushed beyond the IB on either side, in IB units, which is the number the screen computes above. The range play is the part that matters here: the IB edges are the day's first range, and each day type tells you whether that range is holding, extending, or gone.
| Day type | Initial balance | Extension | Tell | Range play |
|---|---|---|---|---|
| Normal | Wide IB, the widest of the week, set by early conviction in both directions | None, or under a quarter IB on one side; day range about 1.0 to 1.15 IB | Price rotates inside the IB all day; value builds in the middle | Fade the IB high and low, target the IB midpoint, then the other edge. The best fading day there is |
| Normal variation | Medium IB | One side, a quarter to 1 IB; day range 1.25 to 2 IB | Extension comes on a pullback to the IB edge, then holds outside it | Stop fading the extended side. The IB edge that broke becomes the pullback level: buy it (or sell it) with the extension, target the extension high. Fade only the far edge |
| Trend | Narrow IB, the narrowest of the week | One side, more than 1 IB, and still going; day range over 2 IB | Higher lows all day, single prints, price never returns into the IB | No fading. The IB is a launch pad, not a range. If you must trade, buy pullbacks to the top of the last extension, never against it |
| Double distribution trend | Narrow IB, quiet first hour | One side, after a pause; the day builds 2 separate value areas joined by single prints | A second balance forms outside the IB, then the single prints between them hold | Treat the second distribution as the new range: fade its edges, not the IB's. The single prints are the stop level |
| Neutral | Medium IB | Both sides, each about a quarter to half IB; close back inside the IB | Extension up fails, then extension down fails; buyers and sellers both tested and both gave up | Fade the failed extensions back to the IB midpoint. Both edges are tradeable once each side has failed |
| Neutral extreme | Medium IB | Both sides, and the close lands at one extreme of the day | Same two-way test, but one side wins late and the close sits at the high or low | Fade the first failure only. Once the second extension holds into the close, that side is the winner; stand aside or go with it |
| Non-trend | Narrow IB | None; day range about equal to the IB and the IB is tiny | Nothing happens; a holiday or the day before a number | Scalp the IB edges for ticks only, or take the day off. The next day's IB will be the interesting one |
How it classifies. IB size is the IB high minus the IB low. Extension up is the day high minus the IB high, divided by the IB size (0 if the day high is inside the IB); extension down is the same from the low. The ratio in the corner is the day's range so far divided by the IB. Rules, in order: both sides extended by at least 0.25 IB is a neutral day (neutral extreme once the last price is in the top or bottom 20% of the day's range); one side extended by more than 1.0 IB, with the last price outside the IB on that side, is a trend day; one side extended between 0.25 and 1.0 IB, or more than 1.0 with the last price back inside the IB, is a normal variation; both extensions under 0.25 IB is a normal day (a non-trend day if the IB is under 40% of the last 10 sessions' average IB, which the screen can't see, so it says so). The double distribution trend can't be read from 5 numbers; the screen points at it when a trend day's last price has stalled more than half an IB from the extension high. Keyboard: 1 to 3 load the examples.
Educational tool only, not financial advice. Day types are read cleanly at the close and read with a guess at 11:00. The earlier you classify, the more the classification is a bet.
Built by Jason Parker, founder of Trading Ranges.
Built by Jason Parker, founder of Trading Ranges.