Volume Imbalances (VIB)
Volume Imbalances (VIBs) represent price gaps with active trading, unlike traditional gaps that show an absence of trading activity. These imbalances often indicate institutional activity and potential reversal points.
Understanding Volume Imbalances​
VIBs come in two main types:
-
Bullish Volume Imbalances
- Opening above previous close
- Closing above previous close
- Overlap between current low and previous high
-
Bearish Volume Imbalances
- Opening below previous close
- Closing below previous close
- Overlap between current high and previous low
Trading VIB Patterns​
Key aspects to consider:
-
Entry Points
- Wait for price to revisit VIB zone
- Look for additional confirmation
- Consider market structure
-
Confirmation Tools
- Order Blocks alignment
- Market Structure support
- Volume analysis
Combine Volume Imbalances with Fair Value Gaps for stronger trade confirmation.
FAQ​
What is a Volume Imbalance?​
A Volume Imbalance is a price gap that shows active trading, unlike traditional gaps. It indicates strong institutional activity and often serves as a magnet for price to return to.
How is a VIB different from a regular gap?​
Unlike regular gaps that show no trading activity, Volume Imbalances have active trading within the gap zone. This makes them more reliable for trading as they represent actual market participation.
How do you trade Volume Imbalances?​
Trade VIBs by waiting for price to revisit the imbalance zone, then look for confirmation from Order Blocks and Market Structure. Always consider the overall trend direction.