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Value Area (VA)

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Definition of 'Value Area (VA)'

The Value Area is a Market Profile concept.

This is an area demarcated by 2 prices which bound the "most traded in" part of a time period.

Technically the value area is 1 standard deviation away from the most traded at price which is the price which has the highest number of TPO's. This price is also known as the Point of Control (POC).

Each time that the market trades at a price during a half hour bracket a letter is added to that price (one per half hour) and a vertically aligned bell curve is created. The middle chunk of that chart is the Value Area.

Typically, the upper and lower prices of the Value Area, know as Value Area High (VAH and Value Area Low (VAL) are seen as support and resistance lines - in their simplest terms.

1287.50 G
1287.25 G
1287.00 EFG
1286.75 EFGH
1286.50 EFGH
1286.25 EFGH
1286.00 EFGH
1285.75 EFGH
1285.50 EFGHL
1285.25 EFGHL
1285.00 EFGHL
1284.75 EFGHIL
1284.50 EFGHIL
1284.25 EFHIL
1284.00 DEFHIKL
1283.75 DEHIJKL
1283.50 DEHIJKLMQ
1283.25 DEIJKLMQR
1283.00 DEIJKLMQR
1282.75 DEIJKLMQR
1282.50 DEIJKMPQR
1282.25 DEIJMPQR
1282.00 DEIJMPQR
1281.75 DIJMNPQR
1281.50 DIMNPQR
1281.25 DIMNPQ
1281.00 DIMNPQ

1280.75 DNPQ
1280.50 DNPQ
1280.25 DNP
1280.00 NP
1279.75 NP
1279.50 N

Generally, the top of the value area provides intraday resistance while the bottom of the value area intraday support. This is more likely to happen when the market opens inside the value area.

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