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    John

    Huw,

    The profiles (volume and Market Profile) are a great way to view the auction process.  As the market moves higher, buyers may believe that price is to expensive and back off, attracting sellers and a new auction will begin in the other direction.  When prices get to "cheap" sellers back off and the auction higher will ensue. Markets in balance will rotate from low to high and back to lows (approximately) providing opportunities for reversion (or rejection) trades near the extremes. This is a great way to look for "cheap" trades and can continue to give good opportunities as long as the market remains in balance.

    When the collective perception of value changes, the price will leave the area of balance looking for a new area of balance where two sided trade can resume. Paying attention to the volume as it increases and decreases can help decipher when an auction is near exhaustion and a change is imminent. Increasing volume indicates a strong auction, decreasing volume might indicate that an auction is nearing exhaustion.

    So, the profiles aren't signal indicators as much as they are a way to consistently put a framework or structure on the market to help in understanding the "health" of the auction, what direction the market is attempting to go (if any), and the strength or weakness of the current move.

    Using profiles in tandem with non-related indicators might help your ability to find the good trade locations where you can limit risk and look for bigger profits.

    Hope this helps.

    Hoag

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