While Market Profile indicates how long price traded at each level, Volume Profile shows how much volume was traded there. Since it's volume – buying & selling – and not time that moves markets,
Volume Profile is considered more of a “true
” technical analysis study by many traders.
What is Volume Profile trading?
Essentially, Volume Profile
takes the total volume traded at a specific price level during the specified time period and divides the total volume into either buy volume or sell volume
and then makes that information easily visible to the trader.
What does Volume Profile indicate?
What is the Volume Profile indicator? Volume Profile is an advanced charting study and indicator. It
shows the traded volume amount of an asset over a specified period, at certain price levels
. Volume Profile makes use of previous traded volume and all the strategies and plans are brought from historical data.
What is my market profile?
Market profile is a
style of plotting “Price” on the Y-axis
and “Time” on the X-axis, which most of the time form a bell-shaped image as the body of the profile. It helps day traders identify Other Timeframe Participants (Big players) who have money and information power.
Do Professional Traders Use Volume Profile?
A
professional trader looks at the volume profile
and realizes the stock is far away from the current “value area” (VA). Thus, they will put a limit order down near the $410.50 area, to pick up the long position near the top of the value area high (VAH).
How do I get a free Volume Profile?
For those interested in free Volume Profile & Market Profile charts,
visit Gocharting.Com
. Its free to use and has both Market Profile and Volume Profile. Will look into it. Underlying indicator is the same but.
Which time frame is best for Volume Profile?
The Volume Profile is a very powerful tool that can adapt to each time frame. No matter if you want to do short-term or long-term trades you can attach the tool to each timeframe. From our experience, the best time horizon for day trading is
daily
. For scalping, you can use the hour profile or 4-hour profile.
How do you create a volume profile?
- In the menu select Insert, point to Drawing and then to Volume Profile Drawing.
- Click the Volume Profile Drawing icon on the Drawing toolbar.
- Click the arrow next to the Drawing Tools icon on the Main toolbar, point to Volume Profile Drawing.
How do I use thinkorswim volume profile?
On the thinkorswim® platform from TD Ameritrade, select the Charts tab and enter any symbol.
Select Studies > Add Study > All Studies > U–W > Volume Profile
. By default, the volume profile will display in the expansion area to the right of your traditional price chart, but there are other ways to view this study.
What is the best volume indicator on Tradingview?
The reason why
Chaikin Money Flow
is the best volume indicator and it's better than the classical volume indicator is because it measures institutional accumulation-distribution . Typically on a rally the Chaikin volume indicator should be above the zero line.
How useful is market profile?
A market profile chart is
useful for judging how an asset has trended over the course of a single trading day
. By using this tool traders can understand how heavily the asset has traded, at which prices and in which direction the asset has moved. For this reason it's particularly relied on by day traders.
How is market profile calculated?
- Count the total number of TPOs in a single day's profile.
- Calculate 70% of this number.
- Identify the Point of Control (POC), the longest line of TPOs closest to the center of the profile. …
- Add the TPOs of the two prices above and below the POC.
What is normal day in market profile?
Normal day is
a balanced market profile but with a wider Initial Balance
. It occurs generally 65% of the total profile, the most widely seen profile in any markets. Trading centers around the point of control (fair place to conduct any business).
