medium · Volume Profile Analysis auction-market-theory
A Market Profile chart shows that the session high has only a single TPO letter printed at it — the H period — and no other period touched that price. The high was never revisited and the market sold off from it sharply. In contrast, the session low shows four TPO letters from four consecutive periods.
How should a skilled profile reader interpret these two extremes?
- The single-TPO high is an excess tail indicating strong rejection — it is a well-formed high; the multi-TPO low is a poor low that is vulnerable to being revisited
- The single-TPO high is a poor high likely to be tested again in a future session, while the multi-TPO low is the excess tail showing strong, decisive rejection from below
- Both extremes are equally reliable references because the raw TPO count printed at the high or low has no bearing on the structural quality of either the high or the low
- A single-TPO extreme is always a textbook trend-day signature and reliably signals the market will continue straight through that level in the very next session
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