medium · Volume Profile Analysis trading-strategies
A session opens with a 'Narrow Initial Balance' in the DAX futures. By $10: 30 AM, the Initial Balance high has been broken, and each subsequent hour prints a fresh high. Retracements are shallow, holding at the developing VWAP.
How should a trader manage counter-trend resistance levels in this environment?
- Ignore them or treat them as targets, as they are likely to break.
- Wait for a 50% retracement of the daily range before entering.
- Enter 'fade' trades at each obvious resistance level to capture mean reversion.
- Close all long positions as the market is 'overextended'.
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