The range formed during the first hour of trade (9:15–10:15 AM); provides structure for the rest of the session.
The Initial Balance establishes the day's early auction range and serves as a critical reference for subsequent price action. Wide IB ranges often indicate high volatility and potential range days, while narrow IB formations may precede trend development or breakouts. Many traders use IB extensions (1.5 IB, 2 IB) as profit targets for trend day scenarios.
