Video summary

The Secret To Using The Volume Profile

Main summary

Key takeaways

Technology

Summary of the Video (Volume Profile Trading Guide/Strategy)

Claims Performance Improvements

  • The speaker says that after implementing Volume Profile into their trading, their win rate increased dramatically (“skyrocketed”).
  • They also claim Volume Profile can flag trades before they happen, leading to very large moves in the examples provided.

Critique of “Normal Volume” Indicator

  • “Normal volume” (traditional volume bars over time) is said to be not very helpful because it shows volume per time interval (e.g., candles), not where buyers/sellers were active by price.
  • This can lead traders to enter at price levels where institutions are offloading, implying poor trade location.

What Volume Profile Is (Key Concept)

  • Volume Profile is described as “normal volume flipped sideways.”
  • Instead of showing volume over time, it shows volume per price level.
  • It highlights which price levels received the most activity—suggesting where the market’s real interest and “big money” participation likely occurred.

Tutorial / Setup Steps (TradingView)

  1. Platform: Go to TradingView.
  2. Indicator selection:
    • Open the Indicators tab
    • Search “Volume Profile”
    • Choose a specific “fixed” version.
  3. Chart drawing: Draw the profile by marking a recent swing low to a recent swing high.
  4. Critical settings: Enable Volume Area High and Volume Area Low in the indicator settings.

How to Interpret the Volume Profile

The Three Main Reference Levels (and Value Area)

The video emphasizes three reference levels:

  1. Point of Control (POC) (red line)
    • The price level with the highest volume / most participation.
  2. Volume Area High
    • The upper boundary of the value area.
  3. Volume Area Low
    • The lower boundary of the value area.

Value Area Concept (~70% Rule)

  • The region between Volume Area High and Volume Area Low is presented as the range where ~70% of all traded volume occurred.
  • Anything outside that range is treated as anomaly territory (very cheap or very expensive prices).

Price Behavior Logic (As Described)

  • Low volume nodes: Price tends to move quickly/spike, with less hesitation.
  • High volume nodes (value area / heavy participation): Price tends to consolidate sideways because buyers and sellers are “fighting.”

Mean Reversion Idea

  • Price may briefly move below Value Area Low, then revert toward the POC.
  • Price may move above Volume Area High, then revert back toward the POC.

Strategy Rules (Conceptual “High Performing” Setup)

Long Setup (Cheap)

  • Buy when price drops below Value Area Low (“cheap”).
  • Take partial profits near the Point of Control (POC).
  • Take full profits if price becomes “expensive” later (implied as moving away from POC toward higher/value boundaries).

Short Setup (Expensive)

  • Short when price rises above Volume Area High.
  • Take partial profits at POC.
  • Take full profits when price becomes “cheap” again (implied return toward/below value).

Example Trade Analyses (Claimed Large Returns)

AMD Example (Weekly Timeframe)

  • Uses weekly Volume Profile from the move’s low to high.
  • Claims:
    • Entry at/near Volume Area Low / demand zone
    • Price spiked upward from the entry region
    • ~300% move is claimed
    • Later, since price was above Volume Area High (“expensive”), it allegedly mean-reverted back to POC, where stops supposedly aligned, and then rose again.

“Paramount” Example (Weekly Timeframe)

  • Starts with price above Volume Area High; the author claims a short works and mean reversion begins.
  • When price later moves past Value Area Low (“cheap”), they switch to a long.
  • Claims an ~888% move with immediate follow-through from the entry point.

Timeframe Guidance

  • The speaker says Volume Profile works on any timeframe (from 1 minute to daily, etc.).
  • Their preference is higher timeframes (weekly) to establish stronger levels that institutions may watch—provided the trader is patient enough to wait for price to reach those levels.

Additional Recommendations (Confluence)

  • Volume Profile is described as more powerful when combined with other tools:
    • Supply and demand
    • Normal volume
    • Price action tactics
  • The video also includes a call to action:
    • Join the speaker’s free Telegram for additional setups.

Main Speakers / Sources

  • Single primary speaker (the channel creator/author of the tutorial).
  • No other named speakers or external sources are cited in the provided subtitles.

Original video