Volume Profile and Market Profile™ are amazing tools and used by traders to analyze the structure of trading markets for potential opportunities and both are considered to be created by Mr. Peter J Steidlmayer. As traders, we inevitably come across volume analysis. If we understand that price is empty and that it is there only to facilitate a transaction. Then we begin to look at where the volume is conducted at a particular price, which has been conceptually conceived of by Mr. Peter. J Steidlmayer in 1958 with the application of the Gaussian curve to financial market trading.

Volume Profile is a charting tool that displays trading activity over a specified time period at certain price levels. The profile is constructed using volume data, which shows the amount of trading activity that took place at each price level.

Whereas Market Profile™ is a graphical representation of the time and price action. It is plotted on the vertical axis of the chart to show the price scale, and on the horizontal axis of the chart to show the time scale. It focuses on price distribution during the trading session and comonly as a bell curve, known as the “TPO” profile, where TPO stands for Time Price Opportunity.

The present day and modern term for Market Profile™ is Time Variable Profile, known as TVP and developed by Mr. Steven Hawkins. This is a unique way of manipulating Market Profile™ developed by Mr. Steven Hawkins. It is a way of customizing the internal timings of TVP generation. It is all a form of Market Profile™ which enables traders to observe the two-way auction process that drives all market movement. Monitoring the ebb and flow of price over time in a way that reveals patterns in herd behavior. It is a way to see the market in a different way, revealing the underlying dynamics of supply and demand. Learn more by subscribing to the newsletter below.

Breaking down the differences between Market Profile™ and Volume Profile:

1. Basis of Information
   1. Volume Profile uses volume as the key data point
   2. Market Profile™ uses time as the key data point
2. Data Representation
   1. Volume Profile uses horizontal bar charts overlayed on candlesticks to communicate with the trader
   2. Market Profile™ uses letters (TPO) to represent periods of time to communicate with the trader
3. Trading Philosophy
   1. Volume Profile is typically used to understand volume at price
   2. Market Profile™ is derived from auction market theory and the importance of price over time

Understanding Market Profile™ and Volume Profile Similarities

1. Purpose - Both Market Profile™ and Volume Profile are used to identify trading opportunities via price spent at a particular time
   1. Volume Profile is used to identify where volume is spent at a particular time
   2. Market Profile™ is used to identify where time is spent at a particular price
2. Time Usage in Trading - Both Market Profile™ and Volume Profile are used to identify trade opportunities based off of time spent at a particular location
   1. Volume Profile is used to identify trading opportunities based on volume spent at a particular price
   2. Market Profile™ is used to identify trading opportunities based on time spent at a particular price
3. Root Understanding - the application of the Guassian distribution curve to financial markets are in both Market Profile™ and Volume Profile
   1. Volume Profile is based on the Guassian distribution focusing on volume
   2. Market Profile™ is based on the Guassian distribution curve focusing on time

Caption: Market Profile™ and Volume Profile are both based on the Guassian distribution curve and showcases time spent is typically volume spent at a particular price

Volume Profile and Market Profile™ are essentially the same tool, while they may be viewed as different tools with unique approaches. The two profiling techniques are rooted in the same philosophy and framework developed by Mr. Peter Stieldmayer and developed further with the partnership of Mr. Steven Hawkins. Profile trading either with Market Profile™ or Volume Profile enables traders to identify trading opportunities based off of market structure.