# Strategy "The difference between the balance points"

This strategy is a consequence of the "Critical Imbalance" strategy. It will give you an accurate answer to the following questions:

1. Is the trend strong now? (judging by the price movement during the imbalance)
2. How strongly has the market reacted to the rebalancing?
3. Is this recovery a reversal or a continuation?

Step 1. Go to "Add Widget" and open the Trading View tab.

<figure><img src="https://50984263-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FxvSjYcSxDfAX6PVpWdgr%2Fuploads%2FThxtcvtPBtO2FrwfjIQ1%2Fimage.png?alt=media&#x26;token=0571f717-45cc-4195-9dca-67c06786b6bd" alt=""><figcaption></figcaption></figure>

Step 2. In the Trading View tab, select the trading instrument and the timeframe of interest.

<figure><img src="https://50984263-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FxvSjYcSxDfAX6PVpWdgr%2Fuploads%2FROKs1OqgzdeN9nzyODXK%2Fimage.png?alt=media&#x26;token=6b58c14c-45eb-4d42-8495-bd989dbfb0ab" alt=""><figcaption></figcaption></figure>

Step 3. Open the "1EX Indicators" and turn on the "Balance indicator", then select the Rolling period

<figure><img src="https://50984263-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FxvSjYcSxDfAX6PVpWdgr%2Fuploads%2Fb52dpfSO4WDpRLmQivPZ%2Fimage.png?alt=media&#x26;token=ebd14b6a-09ef-4185-af57-dd2601cf7ff8" alt=""><figcaption></figcaption></figure>

{% hint style="warning" %}
**IMPORTANT!!!**

The "**Rolling period**" field is the time interval for which the indicator calculates a certain value.

To get better results, you need to choose a period that will be a multiple of 20-50 times your working timeframe on the instrument chart. Lower multiplicity means higher sensitivity, higher multiplicity means lower sensitivity.

**Example:** TF = 5 minutes, Period = 4 hours (48 candles of 5 minutes each).
{% endhint %}

We get such a workspace window:

<figure><img src="https://50984263-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FxvSjYcSxDfAX6PVpWdgr%2Fuploads%2FWGaFF593D98V5FuRcl0A%2Fimage.png?alt=media&#x26;token=d4784d8e-bad1-4742-b8f0-7d37c7d89f9a" alt=""><figcaption></figcaption></figure>

{% hint style="info" %}
**The value of the indicator lines:**

_<mark style="color:green;">Green line</mark>_ - relative value of the dominance of green candles (upward dynamics).

_<mark style="color:red;">Red line</mark>_ - relative magnitude of the dominance of red candlesticks (downward dynamics).
{% endhint %}

**Description of the trading strategy!!!!!**

Determine the movement potential based on the price difference between the balance points. We analyze the first balance point and the next balance point for the location of the candle (price). After that, we select two price levels at these points and look at what the imbalance was (long or short). Next, we measure the distance between prices (reaction) and use strategy patterns to identify the potential for movement.

## Strategy patterns and entry points to the deal

<mark style="color:green;">Long</mark> patterns:

1. After a strong imbalance, the recovery price goes even higher.

<figure><img src="https://50984263-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FxvSjYcSxDfAX6PVpWdgr%2Fuploads%2F0WEkqJxLKo40Ko59d0ok%2Fimage.png?alt=media&#x26;token=b573d5bd-0b84-4ded-9607-f2acace5ebe2" alt=""><figcaption></figcaption></figure>

2. After a strong imbalance, the recovery price gives a weak reaction.

<figure><img src="https://50984263-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FxvSjYcSxDfAX6PVpWdgr%2Fuploads%2FiDvnJ5J0KMarl41w1hjQ%2Fimage.png?alt=media&#x26;token=2cb1d5af-dd1c-4b1e-a59d-88106ad5afc5" alt=""><figcaption></figcaption></figure>

3. After a strong imbalance, the recovery price gives a stronger reaction.

<figure><img src="https://50984263-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FxvSjYcSxDfAX6PVpWdgr%2Fuploads%2FwPEMW4l8B5KbGPPqq943%2Fimage.png?alt=media&#x26;token=e570b20d-4232-40de-afcc-d7f40054e36e" alt=""><figcaption></figcaption></figure>

<mark style="color:red;">Short</mark> patterns:

1. After a strong imbalance, the recovery price goes even lower.

<figure><img src="https://50984263-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FxvSjYcSxDfAX6PVpWdgr%2Fuploads%2FvyBw3vUEkufOu35YDDTJ%2Fimage.png?alt=media&#x26;token=61be2045-08d3-44f8-b171-1042f10dd079" alt=""><figcaption></figcaption></figure>

2. After a strong imbalance, the recovery price gives a weak reaction.

<figure><img src="https://50984263-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FxvSjYcSxDfAX6PVpWdgr%2Fuploads%2FhXDk6r0QryeRUjWFwYvF%2Fimage.png?alt=media&#x26;token=4e45cb8f-0349-4dda-9aa1-31421ec97b12" alt=""><figcaption></figcaption></figure>

3. After a strong imbalance, the recovery price gives a stronger reaction.

<figure><img src="https://50984263-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FxvSjYcSxDfAX6PVpWdgr%2Fuploads%2FjlZIyYdd8hBGAlkS6CQs%2Fimage.png?alt=media&#x26;token=336e1d67-9419-43ec-96a6-888c466f35ef" alt=""><figcaption></figcaption></figure>

CONCLUSIONS:

You can use this strategy both independently and as one of the filters within a variety of trading strategies used by traders.

{% hint style="danger" %}
**IMPORTANT!** Trading involves risks. The user is solely responsible for their actions or inactions when using the described trading strategy. The strategy and its description are for informational purposes only. The information provided here does not constitute personalized investment advice. News, articles, expert comments, research, forecasts, and other information are presented without considering any specific investment profile, and the financial instruments or operations mentioned may not align with the expected returns, investment horizon, or acceptable risk levels for any particular user. Company 1EX is not responsible for any potential losses resulting from trades based on the described strategy or investments in the financial instruments mentioned in this publication.
{% endhint %}
