TIMESTAMPS
00:01 – INTRO
01:07 – UTILITY
What is Value?
What is a Single Print?
What is a Fair Value Gap?
What are the differences between traditional markets and cryptocurrency?
To understand Value, one must understand Auction Market Theory.
The Godfather of AMT is J. Peter Steidlmayer.
AMT has three key phases – Price, Time and Volume.
Auction Market Theory (AMT): A philosophy that markets drive towards a certain direction, either up or down, due to imbalances between market participants (buyers and sellers) until price “stabilizes” at a level where participation is balanced and the most trade can be facilitated (this is Fair Value).
The Value Area represents 70% of the day's total Volume or TPOs.
A Single Print is described as a single TPO printed on the Market Profile during a 30-minute auction process.
Single Prints, due to their nature of price action based on time, show price acceleration between levels.
Because of the speed at which price diverges from “balance” creating an “imbalance”, price tends to gravitate toward (retest) that area to determine if “Fair Value” has been established.
08:23 – IMPLEMENTATION
🔎 08:23 Example of a Single Print area being retested in Crude Oil (CL!).
Each letter on the chart is represented by a 30-minute auction.
The first hour of trade is called the Initial Balance (also known as the A and B period).
You can see that once the C period opened, buyer aggression overwhelmed sellers creating a “Single Print” row.
Price later revisits that area to determine if “Fair Value” was indeed there for further continuation to the upside.
🔎 14:55 Traditional Markets vs Cryptocurrency infographic.
Traditional markets tower over crypto in terms of total market capitalization.
As a result, the majority of market participants arrive to trade during the New York session open. Volume often quadruples during this time, whereas in the crypto markets the volume is sporadic and lacks consistency.
Market Profile in traditional markets can be used for both the New York session and the after hours session. For cryptocurrency, the entire session must be used until one particular market shows more volatility on a consistent basis than the others.
The standard auction process surrounding value is 30 minutes.
Due to the nature and lack of liquidity in cryptocurrency, there is no defining market that has control.
With crypto being a 24-hour market, market profiles will have 48 auction sessions per day.
You can customize your market profile as you see fit.
🔎 20:15 Bitcoin Daily TPO Market Profile example from ATAS.
- On March 13, 2023, buyer aggression came in the “s” period followed by an additional “u” period, leaving behind Single Prints on the Market Profile.
- The “u” period was partially filled later that day during the close of the “x” period.
- You can see on August 17, 2023, seller aggression came in the “J” period.
- The “u” period from the March 13, 2023 price action was “revisited” and determined to have “Fair Value”, as evidenced by the reaction from aggressive buyers, who were still active at the same price level several months later.
🔑 The Single Prints created on June 21, 2023 were revisited on August 1, 2023, once again determining that “Value” was present upon the retest.
🔎 26:03 Current Single Prints on BTC, created on October 23, 2023 as of November 4, 2023.
26:50 – TIPS & TRICKS
★ See what fits you best as far as NY Session vs Entire Session market profiles. Both are very useful.
★ Cryptocurrency as of now needs to be a single day session until a single market proves to be more volatile than others. More liquidity is needed; a spot ETF is a good start.
28:10 – FINAL THOUGHTS