Note: The concepts, terminology, and models discussed in this article are derived directly from the teachings and lectures of The Inner Circle Trader (ICT). This post serves as a structured summary of his original concepts regarding High Resistance Liquidity Run conditions.
The Macro Perspective: Economic Calendar and Weekly Volatility Framing
Weekly price delivery is not random; it is heavily dictated by high-impact economic data releases, specifically events like the Consumer Price Index (CPI) and Producer Price Index (PPI). When these "red folder" macroeconomic events are scheduled for Wednesday and Thursday, the earlier parts of the week (Monday and Tuesday) typically exhibit "reserved" price action.
This happens because the market is effectively "holding" its primary volatility in anticipation of the news-driven injections scheduled for later in the week.
Weekly Volatility Expectations
| Day(s) | Expected Price Action | Rationale |
|---|---|---|
| Monday & Tuesday | Reserved, range-bound, or High Resistance Liquidity Run (HRLR) conditions. | Volatility is conserved for the CPI/PPI data injections. |
| Wednesday & Thursday | High flurry, "blastoff" runs, and sustained one-sided price delivery. | Volatility injection from CPI (Wed) and PPI (Thu) results in strong trending moves. |
Electronic Trading Hours (ETH) vs. Regular Trading Hours (RTH)
During weeks where the volatility is back-loaded, an interesting divergence often emerges between the overnight sessions and the New York open.
- Electronic Trading Hours (ETH): This includes the London session and the pre-market window leading up to 9:30 AM. These sessions are more likely to exhibit trending environments, even when the RTH session is restricted. They provide high-probability moves before the market enters range-bound conditions during US hours.
- Regular Trading Hours (RTH): Beginning at the 9:30 AM New York opening bell, the RTH session is highly likely to shift into range-bound or High Resistance Liquidity Run (HRLR) conditions if major news is pending later in the week. Price delivery becomes "messy," characterized by frequent reversals and strong trade opposition.
Key Reference Points and Dealing Ranges
Precise session framing requires identifying specific time-based ranges and anchoring tools like Fibonacci to define internal "gradient" and "octant" levels.
The Friday Final Hour Range
The final hour of Regular Trading Hours (RTH) on the previous Friday (3:00 PM – 4:00 PM) serves as the primary "final hour RTH dealing range" for the new week.
- Identify the highest high and lowest low within the 3:00 PM – 4:00 PM window.
- Anchor the Fibonacci tool from the low to the high.
- Identify the 0.75 quadrant; this level is critical for pinpointing institutional reference points such as suspension blocks.
The 7:00 AM – 7:30 AM Pre-Market Range
During the pre-market session, the first 30 minutes establish a localized dealing range used to grade the morning's price action.
- Identify the lowest low and highest high between 7:00 AM and 7:30 AM.
- Anchor the Fibonacci tool to this range to determine the 0.375 key octant and other gradient levels.
- Carry these levels forward into the RTH session to identify where price may stall or provide a high-probability reversal.
Essential Technical Arrays and Liquidity Pools
To accurately define the bias and the Draw on Liquidity (DOL), traders rely on specific technical arrays:
- Midnight Opening Price: The price at 12:00 AM New York local time. It serves as a central magnet and the ultimate baseline for defining a bullish or bearish intraday bias.
- New Week Opening Gap (NWOG): The gap between Friday’s close and Sunday’s open. This level acts as a significant draw and a prominent point of institutional interest.
- Inversion Fair Value Gaps (IFVG): A Fair Value Gap that has been completely traded through. In HRLR conditions, these act as hurdles that make price action messy, rapidly shifting back and forth between support and resistance.
- Session Highs/Lows: Key liquidity pools residing at the extremes of the London session or the previous Friday's RTH session (specifically targeting the Friday final hour low).
Understanding High Resistance Liquidity Run (HRLR) Conditions
High Resistance Liquidity Run (HRLR) conditions emerge when price delivery faces constant, grinding opposition. This leads to frequent "messy" excursions and a frustrating lack of clear, easy expansion toward targets.
“I watched this and I wanted to participate in high resistance because you learn more from me doing those things... by me forcing myself to participate in these types of environments after the easy part, when it gets harder, I want you to see what it's like... how to kind of wrestle your trade psyche when you're feeling the press of the stress and the opposition to your trades being real easy and running right to target.”
Price Delivery Mechanics: IFVGs, Suspension Blocks, and Wick Logic
Price utilizes specific inefficiencies and quadrants to validate the Draw on Liquidity (DOL) during tough environments.
Inversion Fair Value Gaps (IFVG)
In HRLR conditions, IFVGs make price "messy" and problematic for the trader. The logic for validation involves:
- Price heavily trades through a defined Fair Value Gap (FVG).
- The FVG is validated as an Inversion FVG when it fails to hold price and instead actively acts as a ceiling or floor.
- Once validated, the DOL shifts toward the New Week Opening Gap (NWOG) or the Friday Final Hour RTH Low.
Suspension Blocks
A Suspension Block is identified within the Friday final hour RTH range. It is defined as a specific candlestick that lays directly on and crosses the 0.75 quadrant level. This block serves as a high-probability turning point or a filter for deep institutional order flow.
Wick Midpoints: Consequent Encroachment (CE)
Wicks provide specific narrative clues for price delivery.
- Identify a significant wick (a long shadow).
- Observe the midpoint (50%) of that wick.
- The Rule: If price decisively closes below the halfway point of a wick, it strongly indicates that price will likely take out the low of that wick entirely.
Trading Psychology and Execution Discipline
Mastering HRLR conditions requires an iron-clad "trade psyche" to handle the opposition and the psychological reality of risking live capital.
- Avoid Forcing the Model: HRLR days will constantly tempt you to force trending models into range-bound, restrictive environments. You must learn to recognize the "reserved" nature of the calendar.
- Real Money Reality: Recognize that trading real capital induces a strong urge to "force" profits (e.g., aiming for a quick $50 or $100 fix). This psychological hurdle must be mastered in demo and forward-testing first.
- Wrestle the Psyche: Accept that trades will rarely be "perfect" in high-resistance environments. The solution? Secure partial profits early to mitigate the intense stress of price repeatedly "wiggling" against your position.
- Submit to the Process: Understand that complex technical questions are resolved through the diligent study of codified content. There are no shortcuts; the answers rely completely on a consistent review process.
Practical Application: The 30-Minute Opening Range Concept
The definitive opening range for Regular Trading Hours is strictly defined as the 9:30 AM to 10:00 AM window.
The 30-Minute Rule: While other methodologies might utilize 5-minute or 15-minute intervals, this framework explicitly identifies the first 30 minutes (9:30–10:00) as the official Dealing Range/Opening Range.
In difficult HRLR weeks, this range is heavily utilized to grade the session. A pivotal technical marker within this application is the 0.375 octant level, which often provides a "beautiful," pristine reversal point for price to sell off or rally back toward the Midnight Opening Price and other institutional arrays.
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