Volume-at-price profile

Volume-at-price, or a volume profile, bins volume by price instead of by time. The price with the most volume is the point of control. High-volume nodes are areas where the market previously accepted trade. Low-volume nodes are areas it passed through quickly. Traders use the profile to frame a mean-reversion back to a node or a continuation once price leaves it.

Not investment advice. Nothing here is a recommendation to buy or sell anything. Backtests and historical studies are not guarantees, and a rule that worked in one sample can fail in the next. Trading can lose money. Links are for education, not endorsements. Do your own research.

Rules

Build a profile over a stated window, such as the cash session or a swing. Mark the point of control and the value area that contains a stated share of volume. In balance, fade a test of the value-area edge back toward the control price, with a stop outside the area. In a trend, trade only in the direction of acceptance outside the prior value area. Rebuild the profile on a schedule so the node does not freeze in place.

Where AI fits

AI can compute the histogram from tick or bar volume and can define value area without a hand-drawn box. It should use one window definition per test. A screenshot annotation of 'the node' after the trade worked is not a rule. Tick data and bar data will not match, and the code should say which it used.

Markets

Futures and liquid stocks with volume at each price. FX spot from a single dealer is a partial profile.

Timeframes

Intraday profiles for the session, or multi-day profiles for swings.

Risks

The profile changes with the window. A node from a holiday session is not support. Bar-based volume splits volume poorly across the bar's range. Profiles look precise and are still descriptive. Two traders using different sessions will 'confirm' different levels.

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