Education · Stage 8 · 01
What it is and what it is made of
Every volume indicator you have seen answers when trading happened. A profile answers where — volume stacked against price rather than along time. That single rotation of the axis is the whole idea, and it turns the auction from the previous stage into something you can look at.
Mak · 3 min read · Stage 8, article 1 of 4
Turning the axis
A normal volume histogram sits under the chart: one bar per candle, telling you how much traded in each slice of time. A profile takes the same trades and asks a different question — how much traded at each price — and draws the answer sideways.
What appears is a shape: fat where a lot of business was done, thin where almost none was. That shape is the balance and imbalance of the previous stage, drawn.
The four components
| POC | Point of control: the single price with the most volume. The centre of agreement for that period. |
| Value area | The band containing about 70% of the volume, with its high (VAH) and low (VAL). The 70% is how the band is defined, not a probability about anything. |
| HVN | High volume node: a fat part. Prices where a lot of business got done. |
| LVN | Low volume node: a thin part. Prices the market passed through without doing much. |
All four are descriptions of what already happened. None of them is a prediction, and the next three articles are largely about keeping that distinction alive under pressure.
The part nobody publishes
Here is something worth knowing before you compare your screen with anybody else's, and it rarely appears in an introduction to this subject.
On many platforms, the profile is reconstructed, not recorded.
Building a profile properly means knowing the price of every individual trade. Some tools do exactly that. Others build it from bars: they take each bar's total volume and spread it across the prices that bar touched, because that is the information they have.
The result looks identical. It is an estimate of the shape rather than a record of it, and it has three consequences:
- Two platforms can show different POCs for the same session, and neither is broken.
- The finer the underlying bars, the closer the estimate — which is why some tools quietly build a hidden fine-grained series to do this.
- Anything that depends on the exact price of the POC is depending on a number that was estimated. Reading structure — where business clustered, where it did not — survives this perfectly well.
If you want to know which kind you have, the question to ask your platform is simple: is the profile built from individual trades, or from bars? It is the same question as the article on market data, arriving three stages later with something concrete at stake.
And the setting that changes everything
A profile always describes a period you chose. Today's session, the last week, a single move. Change the period and every number changes with it.
Which makes the session template — where your platform thinks the day begins — the quiet decider of your POC and your value area. That was a warning in the first stage about session-based levels. Here it is the same warning about a whole chart.
Decide your periods in advance and keep them. A profile redrawn until it agrees with you is the first of the four mistakes in the last article of this stage — and it is the one that catches everybody.