Volume profile

What the numbers mean

The row count sets how finely the price axis is sliced — more rows give more detail and a noisier profile. The value area percentage, conventionally 70%, defines the band around the busiest price that contains that share of the period's volume.

• 24 to 100 rows — how finely the price axis is sliced; more rows, more detail and more noise
• 70% value area — the band around the busiest price containing that share of volume
• POC — point of control, the single price with the most volume traded
• VAH / VAL — the upper and lower edges of the value area

How it is used

Used to find the point of control (the price with the most volume traded) and the value area edges, which act as reference levels; thin patches in the profile are watched as areas price tends to move through quickly.

• POC → the price the market has agreed on most; it acts as a magnet
• Value area edges → where reactions tend to happen
• Low-volume gaps in the profile → price tends to move through them quickly
• A profile with two peaks → two separate areas of agreement; the gap between is unstable

How it relates to everything else

Volume profile answers a question time-based indicators cannot: not when trading happened but at what price. That makes its levels complementary to everything else here — a moving average or pivot that coincides with a POC is treated as a far stronger level than either alone.

• POC + pivot level + VWAP → the confluence intraday traders look for
• Horizontal levels, where moving averages give sloping ones
• The levels depend entirely on the period chosen — a week and a year give different answers

What to watch for

The profile depends entirely on the period selected — the same chart yields different levels for a week, a month or a year — and it describes where trading happened, not where it will.