This is the most accurate post in this thread. And I don't think there is one anyway. In order to build profiles (The standard bell shape activity throughout the trading session) without fixed time or volume segmentation would be like asking for a software which predicts future activity of the market as it knows when to smartly move horizontally in time based on no particular pattern except that it's trying to draw a perfect bell shape profile. I thought of this a while back but didn't have enough time to experiment it. A smart software can (in theory) give out potential scenarios of how the day activity (profile) would look like (after a pre-defined period of time from the trading session start). It can go further in assigning probabilities for each scenario as well. But still even if this exists (or developed), I would doubt the forecasting ability as the day can develop into any profile shape (Not restricted to the perfect bell-shape).
And therefore remains the price point that the market participants most agree on It's because he spent all afternoon on Google
Investor RT, Sierra chart? What else would you build them on? You mean you couldn't select anything other than 30mins?
True dat. Although I see some use in it, the software and data fees always seemed to outweigh to the negative side
Thank you for sharing this. A few follow up questions to you or anyone else here: Given this view of what market profile is for, what is it that is added visually that allows one to identify strong intent or directional volume (which is how I interpret "emotion"), as compared to a simply price chart or ladder? If the purpose is simply to identify intent, why does it matter then whether something is more difficult to short? Intent exists regardless.
You're right that it's on whoever is making the claim to prove that there's value in observing volumes. There's no wisdom in volume itself, but there is information contained in volume relative to other volumes or your own trading approach that you can learn use. I can think of a few values gained from being aware of volume: (1) approximate knowledge of how much size you can put on & take off given your particular time-frame. (2) awareness of when to observe the DOM (if daytrading), e.g., if the market is in a 'relatively low volume' period, it's much more difficult to identify any participant intent. You can verify this for yourself by simply observing 'dead' stocks vs. stocks with a catalyst and see what you notice on the ladder. (3) It tells you about interest in the product and who is interested. E.g., in a product that's active and popular among retail traders, large size sweeping as market nears a level means there's 'technical-style' participants interested in the product vs. 'relatively lower size' and incremental moves towards the level (which may still signify a move beyond the 'level' but less of a chance a 'technical-style' break with stop outs). (4) does provide an indication of someone who is potentially trapped, e.g., large one-sided volume hitting in at a given point and then we get back to that point. Potentially trapped. The key here is 'context.' Are you trading a heavily spread product or one where volume is dispersed across multiple venues? If so, then there's less information contained in this. Are you trading a product with 'relatively' low volumes generally and with no particular reason to expect large directional flow? Same applies. All these could be verified by sitting in-front of a DOM and watching anything being actively traded around specific news event, large technical level breaks that attract new kinds of participants, or just heavily retail-traded products.