medium · Volume Profile Analysis auction-market-theory
A market has been in a multi-day balance. Today it opens well ABOVE the balance area, trades there for the first 90 minutes building a small initial balance, then breaks back DOWN into the prior balance and accepts value inside it by mid-session.
For an auction-market reader, what is the highest-probability read for the remainder of the day?
- Continuation higher, because opening above balance confirms an upside breakout that the early pullback merely retests
- Rotation back toward the FORMER balance's opposite (lower) extreme, because the failed breakout above signals the auction is re-exploring the full balance to find rejected sellers
- A new balance will form at the open's elevated level, because the first 90 minutes of trade there established fresh accepted value
- An immediate sharp trend down through the entire balance, because any failed breakout instantly converts into a same-magnitude move the other way
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