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Volume Profile

The Volume Profile distributes volume by price level instead of through time: the POC is the most-traded level, the Value Area holds 70% of trade, and Low Volume Nodes are the gaps price crosses in a hurry.

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Classic volume answers the question "when did trading happen?": one bar per day. The Volume Profile rotates the perspective ninety degrees and answers "where did trading happen?": a horizontal histogram accumulating volume by price level. The idea descends from Peter Steidlmayer's Market Profile (CBOT, 1980s) and from auction market theory: the market is a continuous auction searching for the prices where supply and demand agree — and the profile is the map of where agreement was found.

In plain terms — Think of price levels as the floors of a building and volume as the time spent on each floor. The profile shows you which floors the market really lived on and which it merely rushed through in the lift. When price returns to a floor, knowing whether it was inhabited or deserted changes your expectations.

The structure

Element Definition Role
POC (Point of Control) The single most-traded level of the period The most "accepted" price: attracts and brakes revisits
Value Area (VA) The band around the POC holding ~70% of volume The agreement zone: inside = balance
VAH / VAL The upper and lower edges of the VA The borders where acceptance or rejection is decided
HVN (High Volume Node) Heavily traded levels Zones that hold price
LVN (Low Volume Node) Nearly deserted levels Gaps crossed quickly, with no "memory"

How to read the chart — Left: the period's profile, computed from the data shown — POC in gold, Value Area in teal, minor nodes in grey. The horizontal lines project POC, VAH and VAL onto the chart. Interactive — the highlighted points explain the POC, a Low Volume Node and the Value Area.

INDICATOR · VOLUME Volume Profile — volume at each price level Horizontal histogram: where the market actually traded CYCLEPEDIA DIAGRAM — EMICICLO VOLUME PROFILE OF THE PERIOD POC VAH VAL POC LVN VOLUME INSIDE THE VALUE AREA 78% POC LEVEL 106 POC and Value Area: the map of where the market found agreement
The profile is the period's memory: where the market built volume, and where it merely passed through.
Hover or tap the highlighted points

Reading it in practice

  1. The POC as magnet and brake — price revisits toward the POC meet the critical mass of existing positions there: it is the level where the most participants hold their entry price, and the reaction that develops there is among the most watched intraday.
  2. Inside or outside the Value Area — inside the VA the market is balanced and range strategies make sense; an accepted exit from the VA (repeated closes outside, with no re-entry) is often the start of a directional imbalance toward the next volume zone.
  3. Low Volume Nodes as motorways — where there is no trading memory, no one defends positions: price crosses LVNs with fast moves. A breakout's natural target is the first HVN beyond the gap.
  4. With the flow — the profile says where to expect the battle; CVD and the footprint say how it is going once you get there.

Limits and traps

Warning — The profile depends entirely on the chosen period: today's POC, the week's and the year's are three different levels, all "true". A profile that does not declare its calculation window is a drawing, not a measurement.

  • On fragmented markets (crypto across exchanges, equities across venues) the profile changes with the data source: always compare on the same feed.
  • POC and VA are attention levels, not bounce guarantees: price honours them for as long as the story that built them stays relevant.
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