What is Auction Market Theory - Trading With Auction Market Theory as a Framework: Auction market theory is a framework based in the notion that financial markets are giant auction mechanisms. They exist to continuously facilitate 2-way trade between buyers and sellers. When buyers are more aggressive than sellers - price goes up. When sellers are more aggressive than buyers - price goes down. When they're relatively even, price is stable. When you look at a chart, this helps … [Read more...]

What is Market Profile - Trading Based on Time-Price Opportunity (TPO) Charts: Market profile (sometimes referred to as time-price opportunity or TPO) is a unique charting method that displays time spent at price. Contrary to standard charting methods, market profile builds out a distribution curve to better showcase opportunity at price. Market profile/TPO charts can take some time to get used to since they're different from conventional methods (line charts, bar charts, candlestick … [Read more...]

What is Volume Profile - Look Inside the Bars/Candles For Areas of Participation: Volume profile is a powerful charting study/indicator that shows volume at price (as opposed to the conventional volume over time). Many traders use bar charts or candlestick charts to track price action (which allow you to visualize the high, low, open, and close of a specified time period) - with volume presented below the chart (showing the volume generated for each individual bar/candle). But … [Read more...]