The IBTool draws the Initial Balance (IB) and double the Initial Balance on your chart at a specified time of day. The Initial Balance and double these values are essential element of Market Profile ® trading. This tool will also give you a breakdown of the largest and smallest Initial Balance that has occurred for all the data that you have loaded as well as the average Initial Balance. This immediately lets you know if the current Initial Balance is larger or smaller than the average, largest, and smallest Initial Balances seen in the data that you have loaded.
The IB in IBTool stands for Initial Balance. The Initial Balance is a Market Profile concept and the calculation of the Initial Balance and double the Initial Balance is done after the first 2 brackets of the Market Profile have been completed for the day. The IB and double the IB are used as trade reference points as areas of support and resistance for fading a market move and for breakout trades.
The basic implementation of the IBTool draws lines at the IB high and low and double these values. It also calculates historic high, low and average Initial Balances.
- Lines showing Triple IB.
- Lines showing Quadruple IB.
- Lines showing 50% (i.e. half way between IBH and DIBH and IBL and DIBL)
- Labels to the right of the line.
- Monday + Tuesday combined IB.
The IBTool and all our other indicators are available to Premium Members.
The IBTool can be configured to plot the IB between any 2 times and so should be usable on any instrument and is flexible enough to be used between any 2 time period in which you want to know the high and low (and double these values). The IBTool can be loaded onto a chart multiple times which allows you to plot the high/low lines between multiple times for any breakout or rotation strategy that you may be trading.
The IBTool defaults to a start time of 09:30 and end time of 10:30 but this is easily changed in the Study Properties.
How to change Parameters
|Use Special Formatting||(Default false) Set this to true to have the values displayed in the native formatting for that symbol. This is mostly used for bonds which traders wish to see formatted in 32nds instead of decimal.|
|IBType||(Default: Today). When Today is selected then the IB lines are drawn based on the IB created day by day. When Mon+Tue is selected then the IB that you see from Tuesday onwards is based on the combined IB from Monday and Tuesday.|
|StartTime||(Default 09:30)Start time of first bracket.|
|EndTime||(Default 10:30) Start time of third bracket (i.e. first second after end of second bracket).|
|Show 50%||(Default false) Set to true if you want to see the 50% line. The 50% line is the midpoint between the IB high and low.|
|Show Triple IB||(Default false) Set to true if you want to see the triple IB lines.|
|Show Quadruple IB||(Default false) Set to true if you want to see the quadruple IB lines.|
|Color IB||Color of the IB and 50% lines|
|Thickness IB||Thickness of the IB and 50% lines|
|Style IB||Style of the IB and 50% lines|
|Color Double||Color of the double, triple, quadruple IB lines|
|Thickness Double||Thickness of the double, triple, quadruple IB lines|
|Style Double||Style of the double, triple, quadruple IB lines|
|Show Info Button||If set to true then the IBInfo button will appear in the bottom left corner of the chart or wherever you specify it to appear.|
(Default true) Set this to false if you don't
want the line labels to appear to the right of the chart. (You need to drag
the chart to the left to see the labels as they will normally be hidden.)
See Cursor Labels for an explanation on the naming convention of the labels.
|Button Bottom||Number of pixels from the bottom of the chart to draw the IBInfo button (if you can't see the IBInfo button then try and set this to a higher value)|
|Button Left||Number of pixels from the left of the chart to draw the IBInfo button.|
|Decimal Points||(Default 2) Number of decimal points to use to format the calculated values if Special Formatting is not used.|
Cursor Window and Labels
The IBTool values have labels which appear in both the Cursor Window and optionally to the right of the chart.
The labels have a prefix of either MT- or T-. MT stands for Mon+Tue and T stands for Today. This allows you to load the IBTool twice onto one chart and configure each one differently and still be able to distinguish between the lines that you see. You will also notice that the name of the study changes when you change the IBType. The study names will be either IB Tool (Mon+Tue) or IB Tool (Today)
The rest of the label is fairly obvious. QIBH (for example) stands for Quadruple Initial Balance High. If you can't work out a label then just ask in the forum and someone will let you know.
- Can be used in any time zone by changing the start and end times.
- IB period can be adjusted by changing the start and end times.
- Works on any time frame.
- The IBInfo button produces stats about the recent IB's that have been seen for that instrument. (Note: the IBInfo button produces the same stats based on individual days and ignores the IBType setting. So if IBType is set to Mon+Tue it will NOT calculate weekly IBStats. If this changes in the future then this text here will be modified.)
- The lines will only be drawn after the end time and through to the end of the day. In the case of IBType set to Mon+Tue, the lines will be drawn from the end of the IB on Tuesday through to the end of trading on Friday.
If there is a holiday on a Monday and the IBType is set to Mon+Tue then only Tuesday will be used to calculate the combined IB for that week.
Tips on using
- The IBTool will not show any lines until the time equals or passes the End time.
- Click on the IBInfo button to get some statistical information on the IB's that have been seen in recent days. The information generated by the IBInfo button is also copied to the clipboard so you can immediately past it into any other application that you want.
Output from Info button
Here is example output from the IBInfo button:
This was generated on the 14 May 2005 for the ES
Tip: To get more stats (and therefore a better average and small/large figure) you should select a Time Template with many days of data. Alternatively you can select the RTH session (by putting =2 after the symbol e.g. ES #F=2) and selecting a 15 minute interval and then panning backwards in the chart which will load more days of data. The you can click the IBInfo button again to regenerate the stats.
Tip: The data that you see in the window has also been copied onto the clipboard so you can now paste it anywhere you want. This might be in a forum, a chat window, a word document or any other application.
Other indicators in this Pack/Series: