What Can Volume Profile Tell Us Today? 

Volume Profile is one of the most misunderstood and least-used technical techniques today, simply because it’s not viewed by crypto traders like a “flashy” study with clear buy and sell signals like the (mis-used) RSI study is. 

It just means that we need to search a little harder to find the information that we need from a volume profile chart. 

Volume Profile shows the amount of volume transacted at a specific price level, as in this bitcoin chart: 

The volume peaks are called “high volume nodes” and represent areas where the price has spent a LOT of time over the past year. When the price is ABOVE a high volume node, it tends to provide support. When the price is BELOW a high volume node, it tends to offer resistance to breaking through it. 

The valleys are a different deal altogether. They show that the price has spent very little time around that price area, more than likely due to a trend where the price just runs through that area, either a downtrend or uptrend. Consequently, valleys do not provide ANY support or resistance since so little volume was transacted there. 

Let’s zoom in and look at the current price: 

We have a very WIDE high volume node from about 19k to 22k, which should provide great support now that the price is above that node, and if the price gets above that minor node at 24k, should be able to easily run up to about 28-29k. 

It would also not surprise me to see the price fall back down into that major node at 20k though. That would not be a bad thing to help coil up energy for the next move.