The Market Profile

BarroMetics Views: The Market Profile

It’s been an interesting 3 days. On the weekend, I received around half-a-dozen  emails asking if I could recommend any courses on Market Profile.

That’s a tough question because there are at least three versions around:

  • One from Pete Steidlmayer (well actually 3 versions from Pete),
  • One from Don Jones (sometimes call the Auction Market Theory version; nowadays the main exponent is Tom Alexander), and 
  • A version by Kam Dhadwar. And these are the ones I know of………!

Pete’ versions were:

1.          (What I call Traditional Market Profile): a daily bell curve composed of 30-minute ranges. The ‘bible’ here is Jim Dalton’s ‘Mind Over Market’s. This book is the best exposition, bar none, of the Trad Market Profile. In Trad Market Profile, the Profile provides trade location and timing of entry; context is provided by the Long Term Activity Charts and ‘Fundamentals’.

2.          Peter evolved the Trad Profile into the Steidlmayer Distribution. This was a massive intellectual leap from the Trad Profile. Whereas the Trad Profile was constructed of 30-min ranges, the Steidlmayer Distribution  was constructed by ranges of any time frame; and whereas the Trad Profile had a fixed beginning and end (beginning and end of pit session), the Steidlmayer Distribution began with a directional move, and ended when either a new directional move began, or ended when a bullish or bearish pattern turned neutral.

3.          The third evolution began when Pete created the Cap Flow software. I lost touch with Profile developments at that point. Knowing Peter, I am sure he has evolved the profile again since then.

    I don’t know of anyone teaching the Steidlmayer Distribution, and the variations after it. I understand that Pete is teaching again; but when I went to his site, http://www.steidlmayer.com/, no courses were being advertised.  The last class was held on Aug 29 2009.  There are a set of books advertised: Blue Books.

    Nowadays, most exponents of  the Profile teach Market Auction Theory. From what I read and seen, the current offerings bypass most of the Steidlmayer Distribution concepts. Instead, the courses teach the application of Market Auction Theory to bar charts/candlesticks. The exception seems to be the courses run by Market Delta. They at least refer to some profile concepts their courses.

    As  for recommending…. I am unable to do so since I have not done any of the courses on offer. Feedback from friends and students suggest you can try:

    1. Jim Dalton’s: J Dalton Trading
    2. Tom Alexander’s: Alexander Trading
    3. Strategic Trading (uses Market Delta): Market Profile Trading Strategies 

    All the best in your search…..

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