hard · Volume Profile Analysis auction-market-theory
A trader notes two different 'excess' setups going into the close: Setup X has a single-print tail on very low volume that formed 3 hours before the close, with two full hours of normal two-sided trade afterward that never approached the tail. Setup Y has a single-print tail on very low volume that formed in the final 2 minutes of the session, with no time left for any follow-through before the bell.
Why does Setup X represent a materially more reliable excess signal than Setup Y, despite both showing an identical thin-print footprint?
- X is more reliable only because it formed earlier in the session, and earlier prints are always weighted more heavily in every profiling method used.
- X had time to test and ignore the tail, actively demonstrating rejection; Y's may just be an artifact of the bell cutting the session short.
- There's no real difference; both are thin single-print tails, and excess makes no reference to time remaining after the print.
- Y is actually more reliable, since forming right at the close means no counter-trend flow had a chance to interfere with the signal.
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