🌟 Capital Market Chronicles – Episode 277: TECHNICAL ANALYSIS – VOLUME PROFILE (Part II)
“The longer the bar, the louder the crowd.” 📏📢
Volume Profile may look intimidating at first —
like someone stuck a barcode on your chart. 😄
But it’s beautifully logical.
🏗 Step 1: Data Aggregation
Volume from lower timeframes is grouped and redistributed by price level.
Instead of asking:
“When did trades happen?”
We ask:
“At what price did most trades happen?”
That shift changes everything.
📊 Step 2: Histogram Construction
You’ll see horizontal bars along the price axis.
-
Long bar → heavy trading
-
Short bar → light trading
Imagine a marketplace:
Busy stall → long queue (long bar)
Empty stall → nobody cares (short bar)
Markets behave the same way.
Where trading is dense, price slows down.
Where trading is thin, price travels fast.
🎨 Step 3: Colour Coding
Many platforms show:
-
Green = buying pressure
-
Red = selling pressure
It’s not just decoration.
It reveals the balance of power.
And trading, at its core, is a power game.
Next: how traders convert this visual into structured trade decisions. 🎯
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