Reading Volume Profile Bins with Bull-Bear Delta and a Point of Control

Summary

This indicator builds a volume profile across a configurable lookback window by dividing the observed price range into bins. It allocates each candle’s volume to nearby bins based on the candle’s closing price, then classifies that volume as bullish or bearish according to candle direction. The display includes relative volume bars, a per-bin delta measure, optional heat-map shading, and a highlighted point-of-control bin with its absolute volume.

The accompanying notes suggest using positive delta near upper price areas to assess breakout continuation, bearish imbalances to watch for supply, and the point of control as a possible reaction level. These are interpretive trade ideas rather than tested signals. The indicator uses candle direction as a proxy for buyer or seller activity and does not report results or validate predictive value. Bin resolution and lookback settings affect the profile, while assigning volume based on closes is a simplified representation of where trades occurred.

Key ideas

• The indicator divides the recent high-low range into price bins and assigns volume using candle closing prices.
• It separates volume from rising and falling candles, then derives a per-bin delta from their relative contributions.
• A heat map emphasizes bins with larger volume and directional imbalance, while the point of control marks the highest-volume bin.
• The document proposes using delta and profile levels for context, but provides no tested entry or exit rules.
• Candle direction is only a proxy for trade-side activity, and the volume allocation method is a simplification.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.