For BWD who is having trouble understanding Market Profile. After reading all you can find and observing for 6 months it may still not make sense and you may not see the wood for the trees. I wrote this to someone else:
In terms of using volume profile I think there is a sequence to learning things that people need to understand and it is probably only possible in a certain order once you understand trade management.
The things I looked at are:
Macro Composite (makes sense when you look over months but hard for me to use to identify big moves).
Current Balance – looking at today vs yesterday, and if appropriate the day before – clearly a move outside brings the last template day into play
Initial Balance – my general but not hard rule a failed second or 3rd test of one end means it extends at the other.
Value Areas after Initial Balance has formed – If there is one thing you said that I listened to the most it is to stay out of the middle and buy or sell Value Areas.
Delta divergence at key levels – is better than 50/50 I think – risk is that the delta has not bottomed but this is acceptable.
Overnight High and Low, POC
Cumulative Delta – too long, too short, location relative to opening price
Where is vwap and mid and PP.
I am trying to make more sense of LVN and HVN, I just leave them on my chart but I do not have the confidence to use them as support or resistance yet.
Now, why to sell at 47/48 presuming you were long at the open for a few points today: at the open shorts were faded and the bounce was to a previous balance area. I scrolled back on my chart to see what was above yday HOD and it was this cluster. It will need news and/or a thin market to breach this (as it did last time during the US holiday). To hold it needs increased volume and confidence and actual participation.