CPR_Previous Day Ranges_Initial Balance

The CPR_Previous Day Ranges_Initial Balance indicator is a comprehensive intraday trading tool designed to plot key pivot levels, historical price ranges, and opening session boundaries to help traders identify significant support and resistance zones.

Usage

The tool is primarily optimized for intraday timeframes (such as 5-minute or 15-minute charts) and is commonly applied to equity indices like the NIFTY or BANKNIFTY.

Traders can utilize the three main components for various strategies:

• Central Pivot Range (CPR): Used to gauge the market trend. A narrow CPR often suggests a potential trending day, while a wide CPR may indicate a sideways or range-bound market.
• Previous Day High (PDH) & Low (PDL): These serve as critical horizontal levels. Price action around these levels can signal breakouts or reversals based on how the market reacted to the previous session's extremes.
• Initial Balance (IB): Represents the high and low range of the first hour of trading. This helps traders define the day's "playing field," where breakouts from the IB range often dictate the direction for the remainder of the session.

Details

This script implements concepts popularized by "Pivot Boss" Franklin Ochoa, focusing on the relationship between price and historical value areas.

• CPR Calculation: The Central Pivot Range consists of the Pivot, Bottom Central (BC), and Top Central (TC) levels. The Pivot is calculated as the average of the previous day's high, low, and close.
• Initial Balance Calculation: The tool identifies the high and low established during the first 60 minutes of the trading day. It also calculates a mid-point (IBM) to provide a secondary reference level within the opening range.
• Security Calls: The script uses request.security to fetch daily data for the pivots and hourly data for the initial balance, ensuring the levels remain consistent across lower intraday timeframes.

Settings

• Show CPR?: Toggles the visibility of the Central Pivot Range (Pivot, BC, and TC levels).
• Show PDH & PDL?: Toggles the display of the Previous Day High and Previous Day Low lines.
• Show Initial Balance?: Enables or disables the plotting of the first hour's high, low, and midpoint levels.

FAQ

How do I use the CPR to determine market bias?

If the current price is trading above the CPR levels, the bias is generally considered bullish; if trading below, the bias is bearish. The width of the range also provides insight into expected volatility.

Can this be used on crypto or forex?

While designed for Indian Indices, the mathematical concepts of CPR and Initial Balance are universal and can be applied to any market that has a defined daily session.

How can I access the CPR_Previous Day Ranges_Initial Balance indicator?

You can get access on the LuxAlgo Library for charting platforms like TradingView, MetaTrader (MT4/MT5), and NinjaTrader for free.