Market Profile Trading A to Z | Order Flow | Auction Market Theory | Value Trading | iTradePod

Market Profile Trading A to Z

Market Profile Trading Glossary

Glossary assembled by Andrew Hall, iTradePod. If you have any feedback or would like to see a term added or amended please leave a comment below or contact us.

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Failed Range Extension - similar to bull trap or fake out. Market participants (usually Locals) auction prices near to or even beyond the Initial Balance range to probe for Longer timeframe market participant orders. However, a lack of conviction from the Commercial/Longer Timeframe market participants results in Order Flow - divergence or simply an Order Flow shift leading to prices being rejected beyond the Initial Balance. Thus, Responsive participants rotate the market back inside the initial balance.

Fair Value - the value price where the auction has discovered equilibrium Buyers and Sellers.

Fractal Price Action - price action that is so intrinsic enough to be observable within all time frames in similar way to the fractal nature of clouds, trees or even the controversial paintings of the infamous American painter, Paul Jackson Pollack.

Fulcrum - a pivotal line in the sand that denotes a pivot point at which price migration, against the prevailing trend, should not be violated particularly on trend timeframing days. During a trend day there is usually a retracement swing high or swing low as inventory adjustment occurs. On the subsequent day the retracement swing high or swing low is used as a line in the sand to determine whether sentiment has changed relative to the prior day’s price action; if the Fulcrum is not breached, there has been no meaningful change in market structure. This technique should be used in conjunction with an examination of real time Order Flow. Fulcrums are fractal so they can be observed on multiple time frames.

Fibonacci Ratios - a series of geometric and harmonic ratios including 0.382, 0.50, 0.618, 0.786, 1.00, 1.272, 1.618 and 2.618. We have a unique way of using the ratios that takes into consideration market developement i.e. whether the market is trending or balanced. We use one set of the ratio numbers for time analysis and another set for price analysis.

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