IBO Flashcards
What is an IBO?
A trading strategy called the initial break out.
What waves are we trading in the Elliot wave theory with an IBO?
Wave 3 or 5
What is the first thing to look for with an IBO?
Rejecting major resistance on the daily; this can be horizontal resistance, ema, fib, etc.
How do you know if we are rejecting a MAJOR support & resistance level?
This resistance should have at least 3 prior rejections.
How do we confirm the IBO setup once rejection of S&R is identified?
We have deceleration and some kind of candlestick confirmation, such as tweezer tops/bottoms, doji, HT/LT, Bearish/Bullish engulfing etc.
What else should you check once IBO is confirmed via deceleration and candlesticks?
We should check M and W charts for confluence. This will help inform us how far we can push targets.
After we identified a rejection and confirmed that rejection is valid. What is the next criteria that we will be looking for?
A break of the 1HR 50EMA
After the initial break, what fib level are we waiting to pullback to?
0.382
How do we protect against a trap with an IBO?
By checking the 4HR price action and ensuring it is in our favor.
On what timeframe do we calculate our IBO entry, target and SL?
5M
What is the safest target and on what time frame are these determined for an IBO?
4HR 50EMA
If Weekly and Monthly momentum is in our favor, what can we target for an IBO?
D 20EMA (1.0 Fib)
If we are trading a daily pullback on an IBO, what is our target?
4HR 50EMA
What is the ideal stop loss for an IBO?
0.75
What is the entry for an IBO order?
The entry target will be around 0.382
Why might you want to enter with an Entry Order?
If you are traveling and can’t be on the charts. Ideally only used when price action is clean, like perfect setups.
Why might you want to enter with a Live Order?
A Live Order allows you to confirm the trade is doing what you expect before taking it.
When placing a trade, what is most important about Volume?
That it is high.
What is an IBO-A?
When we have 4HR confluence; some trend change or price action; for example, double tops or some other confirmation that it is with us.
What is an IBO-B? Why wouldn’t you want to use an entry order?
When the 4HR is still developing and has not yet given us confirmation.
Why wouldn’t you want to use an entry order with an IBO-B?
You’d want to avoid an entry order, because you have no confirmation. Best to enter with a Live Order once you have confirmation.
What is an IBO-C?
An IBO where the 4HR 50EMA has been rejected. Due to this, you cannot target the 4HR 50EMA and you will want more than a 1-to-1, 2-1 minimum, ideally a 3-to-1.
With an IBO-C what is your ideal Risk/Reward?
2-to-1 minimum, ideally a 3-to-1.
With an IBO-C what do we need to confirm on that 4HR?
We really need to confirm that the 4HR rejection is finished before you place that trade.
