Prices where trading crowded react when met again
• A volume-profile zone is a price range where volume was concentrated in the past — people trapped there and people who took profit are gathered in it
• Met from below, breakeven selling pours out and it tends to act as resistance; met from above, buyers waiting to re-buy hold it up and it tends to act as support
• In a zone with thin volume, conversely, price passes through quickly
Connection to our data
• MarketSurfer's symbol level card also shows the volume concentration zones — a volume zone that overlaps support or resistance is the strongest level
Where people slip
• They look only at the horizontal line and not at how much trading has piled up at that line
When setting target and stop prices, the location of volume zones is viewed together. Thin zones are crossed fast, and the fight happens in thick ones.
Before entering, do you check the volume zones above and below and then set your target price?