Market profile vs volume profile comes down to one question: what is being counted at each price. Market Profile counts time, showing how long price spent at each level. Volume profile counts traded volume, showing how much changed hands there. Both build a point of control and a value area, but they can point to different levels.
Quick answer: what is the difference between Market Profile and volume profile?
Market Profile builds a distribution from time: each 30-minute period prints a letter (a TPO) at every price it touched. Volume profile builds the same kind of distribution from traded volume at each price. Both show a point of control and value area, but Market Profile reveals how the session developed, while volume profile shows where the heaviest trade happened.
What each tool counts
Market Profile: time at price
Market Profile was developed by J. Peter Steidlmayer, a trader at the Chicago Board of Trade. The session is split into periods, traditionally 30 minutes, and each period gets a letter. Every price touched during a period prints that letter once, and the letters are called TPOs (time price opportunities).
Stack the letters and you get a sideways bell shape. Because each letter belongs to a period, you can also read the order of events: where the session opened, the first hour’s range, and when price broke out. Our guide to market profile trading for beginners walks through a full chart.
Volume profile: volume at price
A volume profile adds up the volume traded at each price over a chosen range and draws it as horizontal bars. Long bars are high volume nodes, where a lot of business was done; short bars are low volume nodes, prices the market moved through quickly.
There is no time sequence in the bars themselves. You see where trade concentrated, not when it happened. If volume itself is new to you, start with our desk post on understanding volume at key decision levels.
Market profile vs volume profile side by side
The two tools share their vocabulary, which is why they are easily confused. The value area concept is the same in both: the band holding about 70% of the session’s activity, framed by the value area high and low. Only the unit changes. For how that band is built, see value area high and low explained.
| Factor | Market Profile | Volume profile |
|---|---|---|
| Counts | Time (TPOs) | Traded volume |
| Shows sequence | Yes, by letter | No |
| Needs volume data | No | Yes |
| Typical range | One session | Session or any range |
| Best for | Shape and type of day | Precise high-activity levels |
| Main weakness | Ignores trade size | Only as good as its data |
Why the two POCs can disagree
Picture a session where heavy buying and selling happens in short bursts at the open and the close, while the middle hours drift quietly in a narrow range. The volume POC will usually sit where those bursts traded. The TPO POC will sit where price spent the most time, often in that quiet middle.
Neither is wrong. They are answering different questions: where did the market agree for longest, and where did it trade hardest. When both POCs land at the same price, the level carries more weight in our view, because time and volume agree.
The data question for forex and CFD traders
This is the part most comparisons skip, and it matters for UK retail traders. Futures trade on exchanges, so a futures volume profile uses the exchange’s own traded volume; our explainer on what futures contracts are covers the basics.
Spot forex is different. The BIS describes forex as an over-the-counter market that reached $9.6 trillion of trading per day in April 2025, spread across banks and venues rather than one exchange. So a volume profile on a forex CFD or spread bet usually uses tick volume, the number of price changes on your provider’s feed.
Tick volume is a rough proxy. It is often close to the shape of real volume, but it can differ, and it differs between providers. Market Profile needs only price and time, so it reads the same on any feed. That is one practical reason forex traders lean on TPOs, as we discuss in how to trade forex as a UK beginner.
Which should you learn first?
It depends on what you trade and what question you want answered. A simple way to choose:
- Forex, via CFDs or spread bets: start with Market Profile, because it does not depend on volume data.
- Index or commodity futures: volume profile is reliable here, since exchange volume is available.
- Short-term entries: volume nodes give sharper levels for stops and targets.
- Reading the day’s character: TPO letters show balance, breakouts and trend days more clearly.
In our experience many traders end up using both: Market Profile for the shape of the session and volume profile for the exact levels. Learn one thoroughly first, though. Mixing two new tools at once is a good way to see whatever you want to see.
Worked example: one session, two POCs, on a £5,000 account
Example (hypothetical): an index session shows a TPO POC at 7,410, where price rotated through the afternoon. The volume POC sits at 7,395, where a burst of selling traded after a morning data release. Both value areas overlap between 7,395 and 7,420.
A trader planning a long the next day near 7,395 has a level where volume, and the lower part of the TPO value area, agree. With 1% risk on a £5,000 spread betting account (£50) and a stop 10 points below at 7,385, the size is £5 per point. A first target at the TPO POC of 7,410 is 15 points, or about £75 if reached.
Spread bets are leveraged, and a stop can fill at a worse price in a fast market, so the loss can exceed £50. Our 2024 desk post on US500 analysis using Market Profile shows this kind of level work on a live index.
Common mistakes when comparing the two
- Expecting the POCs to match. They measure different things, so a gap between them is information, not an error.
- Trusting forex volume blindly. Tick volume from one provider is not market-wide volume.
- Changing ranges until a level appears. Fix your session or range rules in advance.
- Ignoring price action. Profiles give location; you still need a reason to enter, such as the volume confirmation in how to use volume to confirm a trend.
Frequently asked questions
Is volume profile better than Market Profile?
Neither is better in general. Volume profile is sharper where reliable volume exists, such as exchange-traded futures, while Market Profile works on any market because it needs only price and time.
Can you use volume profile on forex?
Yes, but on spot forex it is built from tick volume or a provider’s own data, because the market trades over the counter. Treat it as a rough guide and compare it with a TPO profile.
Who invented Market Profile?
Market Profile was developed by J. Peter Steidlmayer while he was trading at the Chicago Board of Trade. Volume profiles apply the same idea to traded volume instead of time.
Next steps
Put both tools on the same chart for a week and note each day where the two POCs sit and which one price respected. The Market Profile pillar guide covers the wider method.
Reading location before you trade is central to our price action trading course, and the basics section is free to explore first.
This article is for education only and is not financial advice. Trading leveraged products such as CFDs and spread bets carries a high risk of losing money.
