Open Float
Also: open-interest-float, float
Open Float is the total current open interest — pending stop and limit orders — resting above and below market price in the form of buy stops and sell stops at identifiable price levels. Buy-side open float consists of: protective buy stops held by short sellers above short-term highs, monthly highs, the highest high of the last three months, the six-month high, and the 12-month high. Sell-side open float consists of: protective sell stops held by long traders below short-term lows, monthly lows, the lowest low of the last three months, the six-month low, and the 12-month low. The market is drawn to one side of the float or the other every quarter; which side is targeted is determined by reading whether price is successively failing to make new highs (sell-side draw) or failing to make new lows (buy-side draw). Open Float is the framework that explains why price runs stops above old highs or below old lows and then reverses — the run is fulfilling the algorithm's mandate to access large-fund liquidity.
Identification5
- Buy-side open float levels (in ascending significance): stops above the last bearish shift swing high; stops above the most recent short-term high (weekly/monthly); stops above the highest high in the last three months; stops above the current six-month high; stops above the current 12-month high.
- Sell-side open float levels (in descending significance): stops below the last bullish shift swing low; stops below the most recent short-term low (weekly/monthly); stops below the lowest low in the last three months; stops below the current six-month low; stops below the current 12-month low.
- Price is seeking the buy-side float when: intermediate-term highs keep making successively lower intermediate-term highs AND each rally fails to make a new high, while each decline makes a lower low.
- Price is seeking the sell-side float when: intermediate-term lows keep making successively higher intermediate-term lows AND each decline fails to make a new low, while each rally makes a higher high.
- An intermediate-term high is a swing high with a short-term high to its left and right (three-candle pattern); a long-term high is an intermediate-term high that has lower intermediate-term highs on either side.
Target3
- Near-term target (day trading / scalping): buy/sell stops above/below the most recent short-term high or low.
- Quarterly target: buy/sell stops above/below the highest high or lowest low of the last three months.
- Macro target: six-month or 12-month high/low buy/sell stops when three-month levels have been cleared.
Invalidation2
- A side of float is consumed (run) when price trades through the level triggering the stops and then reverses decisively — the pool at that level is cleared.
- Once the three-month high/low has been taken, the six-month and 12-month levels become the operative open float targets.
Inferred Conditions (Unvalidated)
- The direction of the open float draw (buy-side vs sell-side) is the highest-timeframe directional bias filter — it supersedes lower-timeframe signals.
- A market that continuously violates short-term highs while rarely violating short-term lows is in a buy-side draw regardless of what lower-timeframe setups appear.
- Once the buy-side float (above a major high) is consumed, the immediate reversal and successive violation of short-term lows signals the beginning of a sell-side float draw.
- The open float concept explains why markets do not simply move in straight lines — they must oscillate to create successive new liquidity pools on both sides.
- 12-month highs and lows are the outer boundaries of the open float for long-term position traders; proximity to these levels is achievable faster than novices expect.
ICT Quotes
"A float is the current open interest above and below current market price. And this is going to be in the form of pending buy orders. In other words, buy stocks that are resting above old highs... sell orders that can be below the market price."
"Open float is the study of how the market reaches for the buys and the cells that are above market price. Knowing where orders will be building and stacking above old highs and below old lows that will give you the framework to map out what side of the marketplace that market makers and smart money are seeking to make a run on."
"If intermediate term highs keep creating lower intermediate term highs, and intermediate term lows and short term lows keep going lower each time. It's telling you that it wants the open float the low the marketplace. In other words, it wants to seek the sell side of liquidity."
"You're going to reference where the buy stops are available highs and where the sell stops are below old lows. But what you're watching for is the tug of war that takes place between each new rung on stocks below the market and above the market."
Timeframes
Version History1 version
40-ICT Mentorship Core Content - Month 5 - Open Float.srt
"A float is the current open interest above and below current market price. And this is going to be in the form of pending buy orders. In other words, buy stocks that are resting above old highs. Or it…"
Initial definition in January 2017 delivery of the 2016 Premium Mentorship.
Notes
Open Float is the higher-timeframe directional context layer that sits above individual trade setups. It answers the question: which side of the market (buy-side or sell-side) is the current draw on liquidity? ICT distinguishes Open Float from general Liquidity Pool analysis in file 40 by emphasising the hierarchical stack of levels (weekly/monthly/3-month/ 6-month/12-month) and the read of successive high/low structure to determine which side is being drawn toward. In file 41, Open Float is extended by introducing open interest (from futures markets) as a confirming indicator: a significant drop in open interest (15% or more) at a support level while price is declining signals institutional short covering, providing buy-side confirmation. Rising open interest during a consolidation phase signals institutional distribution (building shorts). This open-interest overlay is specific to futures markets; it is not directly observable in spot Forex. File 42 (Defining Open Float Liquidity Pools) operationalises open float by providing the 120-day (60 look-back + 60 cast-forward) bracket as a revolving window; see open-float-liquidity-pool.yaml for that sub-concept.
Asymmetry Notes
Symmetrical — buy-side and sell-side open float are mirror-image concepts.