Time Price Opportunity (referred to as TPO) is also known as Market Profile Charts in legacy markets.
Back when traders were in the pit, time was broken down into half-hour time frames known as a bracket.
Each half-hour bracket was identified with a certain letter.
Traders on the floor had a trading card, on which they would have to write down the letter of brackets they had traded in.
Each letter was specific to a half-hour bracket, and these letters became the building blocks for TPO Charts.
Now these letters represent a 30-minute candle.
For example: The letter "A" might represent the first 30 minutes of a trading session, the letter "B" could represent the next 30 minutes, and so on.
TPO reveals three things:
The price action.
The most significant price levels (Volume).
The window of time that this occurs.
Using TPO you will be looking at Time, Price, and Volume together, to identify the value of price levels within a given range and newly formed ranges.
IMPORTANT NOTE: TPO is NOT a trading strategy. This is a method to organise data on a chart to enhance your trading strategy
For those that have not completed the Footprint Chart modules, it is necessary to complete these lessons first in order to understand the core principles of TPO.
Time Stamps
5:46 – TPO INTRODUCTION
- TPO charts are similar to how we view fixed ranges (TV tool)
- Difference: Fixed range tool looks at volume while TPO charts look at time
- Daniel uses TPO and volume profile charts together to find discrepancies between time and volume
- When zooming into the TPO chart we can see that there are letters on the chart. Each letter (starting with capital letters, ending with lower case letters) represents a 30-minute candle. Letters start with a capital A and end with X
- It is nice to expand to see how the price was developing during the day
- TPO chart is not the strategy, it just organises the data BUT with Igor’s Session and time it is a new strategy
- We can organise the information and then make trading decisions based on that information in a replicable way
- We are always buying/selling at what we believe is a good value
- Inside the TPO chart, we have the value areas and POC
- We are looking at time, price and volume together to make an informed trading decision
- Without looking at the volume it is difficult to identify whether the price is going to continue to range or breakout
19:45 – RANGING MARKET (+ EXAMPLES)
- When the price is ranging it is considered to be at the fair value
- Each time range high is approached sellers come in (and lack of aggressive buyers)
- Each time range low is approached buyers come in (and lack of aggressive sellers)
- To understand TPO charts you have to understand the dynamics of the market
- Price is moving between balances (sideways) and imbalances (impulse)
- TPO chart helps us to trade between balance and recognise when the price is breaking balance
- With TPO information you can recognise how the price will be moving that day
34:33 – TPO INTRODUCTION
- Starts with a capital ‘A’ and end with capital ‘X’ for the first 12 hours
- Starts with a small case ‘a’ and end with a small case ‘x’ for the last 12 hours
- Each block/column is decided from the TPO tick size
- Daniel uses the 30-minute on 50 tick size-changing that changes everything
- He checks both, VA’s on volume and VA’s on TPO charts to see if there are some discrepancies. If for instance time POC is at 60k and volume POC at 50, it is classed as extremely bearish because time does not coincide with volume (no acceptance)
- Time, price and volume are three key metrics to making the best trading decisions (win rate massively increases)
44:20 – Q&A
59:54 – SUMMARY