137 Volume Profile

Displays the price at which volume is being traded. The price with the most volume is called point control (POC). It can help to reveal support prices. Deviations from POC can reveal short term deviations. From the volume profile one can also calculate the POCPRice or the price at which most ticks occurred (this does not indicate how much volume is being traded but how many people is trading, can be calculated only when number of trades data are available). The volume profile can also indicate the value area, which is the low and high price of the volume profile.

Figure 13.30: Volume Profile

In our book, all three variables of the volume profile are estimated. “PriceDepPOCVol” indicates the difference between H3 (average of high, low and close price) from the Point of Control price. “PriceDepPOCPrice” indicates the difference between H3 from the price at which most trades were done (this is only reliable when data includes number of trades at each price). “PriceDepFromValbands” indicates the number of times H3 is above or below the value area bands.