MP and Volume Profile Questions

This is for me and any other folks who desire a better understanding and interpretation/reading of Market Profile and Volume Profile. Obviously, Bruce, Lorn and some others can probably address this best.

Many posts show the prior day's MP/VolProfile with the VAH/VAL and POC as a chart. Lorn regularly posts the "overnight" ES chart, typically coming into the RTH session.

I'll focus on just Volume Profile at this point. What are folks looking at for the VP ... the prior day's RTH session, with its VAH/VAL and POC? Or are folks incorporating the Overnight session (like Lorn posts) seperately ... or is it "better" to chart the prior day with the overnight, showing a "cumulative" picture coming into the current trading session?

Also, there are times when a post will describe the "meshing" of the past two day's VP activity ... and are folks just looking at HV and LV nodes? In addition, won't there be VAH/VAL and POC levels that are different from just the prior day?

Then there's the unfolding session where the VP (or MP) is being "built" in real time beginning with the RTH session. I think you've done a video on the current session unfolding, Bruce.

What is the arrangement of significance from the different mappings I've listed above (and others) that carries the most weight typically in analysis?

Been thru Dalton's stuff lightly and also Volume Profile analysis. But I'm looking for how one would decide to rank the HV and LV nodes, along with VAH and VAL along with POC. Charts will show variations based on what data is used. Fill me and others in if you will Bruce ... or Lorn ... or anyone who has been following the daily ES MP/VolProf analysis.

Hope this questioning makes sense. It'd be useful for me and hopefully others to better set up our software to track and watch what is being incorporated into the analysis for the posts.

MM

I think Lorn and Bruce are taking vacations right now.

I do not proclaim to be highly knowledgeable of MP or VP.

I hope some one better versed than I am chimes in, but if you think about single prints, they are areas of very little price traffic (Like Bruce's 'Air,' no resistance no support), so once price manages to push into an area of little support or resistance, it can run through it easily.

I think I've heard 'single prints' referred to as a zipper?

Does some one out there more well versed in the idiosyncrasies of MP or VP know of the term "zipper?"

Thanks Paul

Great discussion on market and volume profile. I am relatively new to market profile. I trade crude oil futures full time using mark Fisher ACD system. Comments to foloowing questions will be much appreciated.

How do we recognize a break away from a value area vs. fade the extreme for a reversion back to the mean ( or back to the middle of the value area)? Many traders quote to watch for an increase or decrease in volume. However, volume is a trailing indicator and many times, by the time we get volume confirmation on a 30 minute candle bar it's too late. Plus , there are high quality and low quality volume of the day.

I have heard from many market profile traders that market profile system is not good for a trending day trading, however its excellent for sideways market. I am talking about in terms of day trading only.

Does anyone in this forum trade crude oil futures using market profile?

Thanks,

on Thursday June 23 4:30 PM eastern time Jim Dalton will answer all your questions about market profile. This is a one hour free webinar go to his site jimdalton.com and register

I suggest that you need to dial it down a few time frames. watching for volume to expand or contract on a 30 minute time frame will make you late to the party. Market profile is more concerned with market structure and shouldn't be thought of as the holy grail of trading but it helps in organizing the data.

just a few quick ideas we use on the day trading threads are the cummulative delta and $tick/volume divergences and market delta. Finding what works for oil will be your challenge. I've never looked at an oil chart and don't plan to so I can't help you with that.

I think some traders are better with fading and some like to catch trends. I don't know what is better with oil. Market profile can help with either approach as we basically want to put trades on in low volume areas with the expectation of getting back to high volume areas. Some like to use VPC's from the daily data and initiate trades there. That is essentially trading right in the middle of high volume and not my particular preference. These are the VPC traders and certainly can be a viable plan. I prefer to trade for vpc's as targets.

Trading with the expectation of hitting the center of these mini bell shaped areas when we are at the outter extremes is my basic trade style. I prefer the fringes. I respectfully disagree with your concept that volume lags. I think those who really have bid/ask volume ( footprints etc) mastered will have an edge over us all. A hard thing to really master. Sorry I can't be of more help.

Thanks Bruce. Per your suggestion, I have started watching developing value area based on 5 minutes time frame.

Here's a nice presentation of MP basics for those interested. It's more concise than most of Dalton's.

http://www.cmegroup.com/education/interactive/webinars-archived/building-a-trading-strategy-with-market-profile.html

Does anyone know if Ninja Trader supports volume indicators? I trade based on volume and am now exploring the Ninja Trader platform... is there a special thread on the forum in relation to this or am I writing in the right place?

It depends on what you consider "volume indicators". If you are just interested in total volume than NT is fine. Once you start looking at specific bid x ask volumes it is completely inadequate. There are a few 3rd party add on's (the best of which is free) that can help but NT limitations seriously put you at a disadvantage.

BeyondMP, what's the "best of which is free" volume indicator?

Is there a more advanced volume profile that has just started to be used in turkey?