Recently, more and more people have been asking me about the VPVR indicator, and honestly — it’s one of the most underrated tools in technical analysis. Let me explain why it’s worth paying attention to.

The volume profile indicator (VPVR) is something completely different from the usual histograms we all know. Instead of showing volume over time, VPVR displays it along price levels. This means you see exactly where the largest transaction volumes concentrated. It changes the perspective — instead of asking when something was traded, you ask where.

The main elements I look at:

First, of course, are the histogram bars — vertical columns showing volume at each price level. The longer the bar, the more transactions occurred at that level. This gives you a visual understanding of the market structure.

Then there is the POC, or Point of Control — the price level with the highest volume. It’s usually clearly marked on the chart and is one of the key points I focus on during analysis.

But what really changes the game is the distinction between HVN and LVN. HVN are high-volume nodes — areas where the price spent a lot of time and encountered many orders. These places act like magnets for the price. LVN are low-volume nodes — areas with little trading activity, where the price could move quickly. These are potential breakout points.

In practice, I mainly use VPVR to identify key support and resistance levels. When I see the price approaching an HVN, I know there will be resistance or support there. It works really well, especially on higher timeframes.

The Point of Control serves as a marker for me — when the price breaks through it, I usually see a significant move. Breaking the POC signals that the market structure is changing.

Analysis of consolidation zones also has a big impact. HVNs show where the price consolidated, and LVNs where quick moves occurred. This helps me understand where I might enter on a retracement or where I should be cautious of acceleration.

Regarding breakout trading, LVNs are areas where the price moves rapidly. Breakouts through these levels can signal the start of a new trend. It’s great for short-term trades.

Practical examples? When I look for retracement levels, I check HVNs — these are places where traders previously entered and where they might do so again. If the price returns to them, I have a high probability of a bounce.

Second, when I want to exit a position, I check if we’re approaching the POC or HVN. This can be a signal to take profit, as there might be resistance there.

But a word of caution — VPVR is a tool, not a certainty. It works best when combined with other technical analysis indicators. Don’t rely solely on VPVR when making trading decisions. It’s part of the bigger picture, not the whole picture.

Personally, I believe VPVR is underrated in a trader’s arsenal. It provides a perspective that other tools don’t. If you haven’t tested it yet, it’s worth spending time learning. Market structure is crucial, and VPVR shows you exactly where it’s forming.