Value Area High / Low
Overview
The Value Area is the price range containing approximately 70% of a session's or period's total traded volume. The Value Area High (VAH) is the upper boundary and Value Area Low (VAL) is the lower boundary. These levels act as dynamic support/resistance and are central to market profile and volume profile trading strategies.
Key Concepts
Value Area covers ~70% of total volume, VAH = upper boundary (resistance), VAL = lower boundary (support), Opening inside value suggests range-bound day, Opening outside value suggests trending day, Value area overlap between sessions shows acceptance zones
Entry Signals
Buy at yesterday's VAL if opening inside value, Short at yesterday's VAH if opening inside value, Breakout above VAH with conviction = long trend trade, Breakdown below VAL with conviction = short trend trade, Open within value but migrating = fade to the opposing VA boundary
Exit Signals
Rotation target: opposite value area boundary (VAL → VAH or VAH → VAL), Trending target: next session's value area, Stop beyond the VA boundary + buffer (or within the first LVN beyond VA)
Best Timeframes
30M for session profile; combine with daily composite
Pro Tips
The '80% rule' — if price opens outside the value area and then re-enters, there's an 80% probability it will traverse the entire value area to the other side. This is one of market profile's most reliable setups.
More Topics in This Category
Time & Sales Tape Reading
Time and sales, commonly referred to as the tape, displays every executed trade in real time, showing the price, size, and whether the trade was executed at the bid or the ask. Tape reading is the art of interpreting this flow of transactions to gauge real-time buying and selling pressure, identify institutional activity, and spot absorption or exhaustion before they appear on charts.
Order Book & Liquidity Analysis
Order book and liquidity analysis examines the distribution and behaviour of resting orders across all price levels to map where significant liquidity pools exist. By aggregating order book data over time through heatmaps and liquidity visualisations, traders can identify where large players intend to transact, anticipate areas of support and resistance, and gauge market microstructure health.
Depth of Market (DOM)
The Depth of Market, also known as the order book ladder, displays all resting limit orders at each price level above and below the current market price. DOM analysis reveals where institutional participants have placed large orders, helping traders identify genuine support and resistance levels created by actual liquidity rather than historical price patterns alone.
Market Profile
Market Profile organises price data into 30-minute periods called TPOs (Time Price Opportunities), creating a bell-curve distribution that reveals market behaviour patterns. Developed by J. Peter Steidlmayer at the CBOT, Market Profile identifies day types (Normal, Trend, Double Distribution, etc.) and provides a statistical framework for understanding auction market theory.