hard · Volume Profile Analysis profile-shapes
A 'double-distribution' (B-shaped) profile forms: two fat nodes separated by a band of single prints in the middle, value area calculated by the standard 70% method straddling the thin zone. A trader plans to fade any move back into the single-print band as a 'gap fill toward value.'
Why is this the classic trap with a double-distribution profile, and what is the correct treatment of the middle single prints?
- The thin middle band is a low-volume rejection zone (a range extension separating two balances), so it acts as support/resistance to be defended, not filled — price accelerating through it signals the prior balance is being abandoned, the opposite of a mean-reversion fade.
- The single-print band is the true point of control because it had the fastest auction, so fading into it is correct and the two fat nodes are merely overnight inventory to be ignored.
- A double distribution must be averaged into one value area, making the thin band the high-volume center; fading toward it is therefore the highest-probability reversion trade.
- The middle prints are an excess tail that will be repaired, so the fade is sound but should target the far fat node rather than the thin band itself.
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