In this week’s episode of Money Mondays, NSTA is kicking off a mini series related to profiles and trading.There is much to discuss related to the construction of profiles and also the use for integrated strategies. Over the next few weeks we will be breaking down core concepts related to how we use the Institutional Auction to trade on the same side as the big boys.
The Market Profile was introduced to the marketplace in 1985 by a trader named Peter Steidlmayer and was introduced as a CBOT product. The MP is an intraday Charting technique that takes account of Price and Time and displays this information in the form of a Bell Shaped Distribution Curve, where price is vertical and time is horizontal. It is also called a ‘TPO Profile’, which stands for Time Price Opportunity Profile.
This technique was originally created for Exchange Members by Exchange members. It gave them a new dimension and a more in depth look at price action. They discovered that the bell shaped curve was bigger in the middle than the upper/lower end of the distribution. They called this bigger area the Value Area with its biggest part being the Point of Control.
They have since used this technique on a daily basis to discover intraday market moves and areas where the market created value based on the amount of time spent inside a range.
This Method Can Be Applies to Stocks, Futures & Forex
“Trading success requires you to have a good method and be a good trader in order to succeed…You can’t have one without the other and expect results!” – SK
Watch this week’s Money Monday (Trader TV Show) below to learn more about our Cognitive Training.