Market Profile (TPO - Time-Price Opportunity) visualizes volume traded at each price level over time, originally developed by JP Steidlmayer. It reveals where prices spent the most time (accepting price) and where they spent the least (rejecting price).
Key Use: Identify fair value, volume nodes, and rejection levels for support/resistance trading.
Point of Control (POC)
Price level with most volume traded - fair value anchor
Value Area
Range where ~70% of volume traded - where market finds balance
Unfaired Gaps
Prices where little volume traded - likely target for retracement
Day Trading Targets
POC = day's fair value; above/below = target zones.
Support/Resistance
Edges of value area provide strong support/resistance.
Gap Fills
Unopened gaps above/below value area often get filled.
✓ Advantages
⚠ Limitations