Part 2: Market Structure & Profiles 2/x
Volume Profiles & Distribution Theory
The volume profile is a tool that allows us to see at which levels volume has traded. Either a LOT or very little. (vertical price-based volume)
Remember from our prior lessons, contractions are areas of value, this is where the volume profile produces larger “distributions” or “bellies”. AKA. More volume is traded while prices range.
Bellies can help us identify market strength, trends, and direction.
When trading futures, we can extract the volume profile from Sierra & TradingView.
TradingView: Using the following VP. Visible range & Session profile.
Used for the overall levels & continuous contract.
The Visible range is on the right hand side of the chart and shows us all the volume that is visible on the screen.
Session profile is only visible on an intraday and it will show you the session profile.
You can customize both of them.
When trading futures, we can extract the volume profile from Sierra & TradingView.
Sierra Chart: Using the “simple” volume profile. Available in the chartbook.
Used for more “precise” levels and the overnight sessions included.
These are the main components of the VP. Will be broken down one by one.
Keep reading with a 7-day free trial
Subscribe to Vico’s Newsletter to keep reading this post and get 7 days of free access to the full post archives.