Trading with Market Profile

Discussion in 'Technical Analysis' started by They, Oct 10, 2002.

  1. They


    Ok, lets see if we can get a discussion going on Market Profile.

    I am trading the ES using the previous day's Market Profile levels (upper value area, lower value area and POC) also using the weekly POC/HVL (high volume level) and weekly LVL (low volume level)

    Most trades using the previous day's levels I use a 2 pt target / 2 pt stop. If levels are close I may let a trade move against me to the next level and add another.

    If I enter trades off of the weekly levels HVL/LVL then I use a 3 to 5 pt target / 3 pt stop

    Support and resistance are all there is, everything else is just a giver of confidence.
  2. Hi They,

    I don't see any question I'm assuming your not asking any questions and just want to start a discussion about the value or usefulness of Market Profile.

    My question to's your trading (profitable or losses) via using FIXED profit-targets and FIXED stop/loss management?

    Also...what's a POC?

  3. POC: Point of control. I think this is defined as the price level with the most volume or the mode.
  4. They



    Results are good,

    around 80% for the 2/-2 previous day's level trades
    around 70% for the 3-5/-3 weekly level trades

    Market Profile levels are the most reliable support and resistance levels I have found.
  5. Pabst


    So They, are you only making responsive trades at value extremes? Do you ever trade initiatively outside of value.
  6. They


    Correct me if I am wrong, a responsive trade refers to when you are inside of the value area(daily or weekly) and you would sell/buy the extremes (no breakouts)

    Yes, on many days this trade setup occurs.
    I prefer when the market opens outside of the previous days VA i.e.,

    In a down trending market, when the current session opens below the previous day’s Value Area/VA enter a short trade at the previous day’s lower VA placing a stop 2 points above the previous day’s lower VA. (the open price must be at least 2 points below the previous days lower VA at open of market)

    The example is a trade that is outside of value so in a way could be looked at as a breakdown trade(non-responsive) but I will only enter the short trade if price pulls back up to the level (previous day's LVA)

    It is all about the levels. I can be wrong in my direction bias but the levels will give the reaction required
  7. what software offers realtime market profile info ?

    Aspen Graphics?

    E signal ?
  8. Them


    FYI.......Initiative buying, for example, takes place within or above the previous days value area.
    While responsive buying takes place below the previous day's value area.
    The opposite, of course, is true for selling activity.
  9. There is a statistic that around 90% of the time, the next day's price overlaps the previous day's POC at some time during the day.
  10. They


    Linnsoft's Invest R/T and Erlangerquote offer Market Profile as a study'

    Qcharts, in their beta, offers Volume Profile which gives almost the same readings as MP

    Esignal has a VP study as does Trade Station
    #10     Oct 11, 2002