medium · Volume Profile Analysis Auction Theory & Market Profile (TPO)
Over three sessions a market builds a clear double-distribution profile: a lower bell from a morning balance, a thin single-print 'spike' connecting upward, and an upper bell from an afternoon balance, with the two value-area peaks separated by a low-volume node. The next session opens directly into that low-volume node between the two distributions.
Auction-market-theory's most reliable expectation for that open is that price will:
- Reject the low-volume node and rotate toward one of the two high-volume peaks, because thin single-print areas are unaccepted prices the auction tends to move away from quickly
- Settle and build fresh value within the low-volume node, since opening there confirms the market now accepts the formerly thin prices as fair
- Continue straight through the node in the spike's original direction, because a low-volume node always acts as a continuation channel rather than a barrier
- Collapse the two distributions into a single symmetric bell centered on the node, because adjacent value areas always merge once revisited
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