medium · Volume Profile Analysis auction-market-theory
A trader sees a 'buying tail' from yesterday at 1.0820 and a 'selling tail' from two days ago at 1.0880. Price is currently at 1.0850 in a balanced 'D-shape'.
What is the most likely structural 'draw' for price?
- Price will remain in the current balance (near 1.0850) as the tails represent completed auctions that have been 'flushed'.
- Price will gravitate to whichever extreme has the 'Naked POC' nearest to it.
- Price will break out to 1.0880 because selling tails are 'weak'.
- Price will sweep the 1.0820 buying tail to fill the 'void'.
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