PROTECTED SOURCE SCRIPT
Auction Market Theory: Value Area & VWAP Fade - Dashboard
An "Auction Market Theory" dashboard is a visual summary of the market's state according to the principles of Auction Market Theory. It consolidates key metrics like the Value Area (VA), Point of Control (POC), and Volume-Weighted Average Price (VWAP) into a single, easy-to-read panel on your chart.
What a Dashboard Shows
The purpose of the dashboard is to give traders a quick, real-time snapshot of the market's auction process. It helps you answer critical questions like:
Where is the market's "fair value"? This is shown by the Value Area (VA) range.
Where is the most volume concentrated? This is the Point of Control (POC), the price that acts as a gravitational center.
How are market participants currently positioned? The VWAP provides a measure of the average price paid, weighted by volume. Price trading above VWAP suggests a bullish volume bias, while price below suggests a bearish bias.
Is the market in a state of balance or imbalance? The relationship between the current price and these key levels helps to quickly determine if the market is accepting a price range (balance) or rejecting it (imbalance/trend).
How to Interpret the Dashboard
Value Area (VA) & Point of Control (POC)
These metrics are derived from a volume profile and are the foundation of the auction theory dashboard. The dashboard displays the VA's low and high, as well as the POC. These levels define the market's "accepted" price range for a given period.
VWAP
VWAP acts as a real-time moving average that is more responsive to volume than a standard moving average. It's often used as an intraday anchor. When price is significantly stretched from the VWAP (and its standard deviation bands), it's a signal of a potential over-extension and a target for a mean-reversion trade.
Dashboard's Role in Trading
The dashboard is not an entry signal itself, but a contextual tool. It provides the framework for your trading decisions. For a "fade the edge" strategy, you would use the dashboard to:
Identify the edges: See the exact price levels of the VA and VWAP bands.
Wait for the stretch: Look for price to move beyond those edges.
Confirm the reversal: Only then would you look at other indicators (like RSI or volume spikes) for an entry signal.
Manage the trade: Use the POC as a potential take-profit target, as price has a high probability of returning to this point of volume consensus.
What a Dashboard Shows
The purpose of the dashboard is to give traders a quick, real-time snapshot of the market's auction process. It helps you answer critical questions like:
Where is the market's "fair value"? This is shown by the Value Area (VA) range.
Where is the most volume concentrated? This is the Point of Control (POC), the price that acts as a gravitational center.
How are market participants currently positioned? The VWAP provides a measure of the average price paid, weighted by volume. Price trading above VWAP suggests a bullish volume bias, while price below suggests a bearish bias.
Is the market in a state of balance or imbalance? The relationship between the current price and these key levels helps to quickly determine if the market is accepting a price range (balance) or rejecting it (imbalance/trend).
How to Interpret the Dashboard
Value Area (VA) & Point of Control (POC)
These metrics are derived from a volume profile and are the foundation of the auction theory dashboard. The dashboard displays the VA's low and high, as well as the POC. These levels define the market's "accepted" price range for a given period.
VWAP
VWAP acts as a real-time moving average that is more responsive to volume than a standard moving average. It's often used as an intraday anchor. When price is significantly stretched from the VWAP (and its standard deviation bands), it's a signal of a potential over-extension and a target for a mean-reversion trade.
Dashboard's Role in Trading
The dashboard is not an entry signal itself, but a contextual tool. It provides the framework for your trading decisions. For a "fade the edge" strategy, you would use the dashboard to:
Identify the edges: See the exact price levels of the VA and VWAP bands.
Wait for the stretch: Look for price to move beyond those edges.
Confirm the reversal: Only then would you look at other indicators (like RSI or volume spikes) for an entry signal.
Manage the trade: Use the POC as a potential take-profit target, as price has a high probability of returning to this point of volume consensus.
Script protetto
Questo script è pubblicato come codice protetto. Tuttavia, è possibile utilizzarlo liberamente e senza alcuna limitazione – per saperne di più clicca qui.
Declinazione di responsabilità
Le informazioni ed i contenuti pubblicati non costituiscono in alcun modo una sollecitazione ad investire o ad operare nei mercati finanziari. Non sono inoltre fornite o supportate da TradingView. Maggiori dettagli nelle Condizioni d'uso.
Script protetto
Questo script è pubblicato come codice protetto. Tuttavia, è possibile utilizzarlo liberamente e senza alcuna limitazione – per saperne di più clicca qui.
Declinazione di responsabilità
Le informazioni ed i contenuti pubblicati non costituiscono in alcun modo una sollecitazione ad investire o ad operare nei mercati finanziari. Non sono inoltre fornite o supportate da TradingView. Maggiori dettagli nelle Condizioni d'uso.