Value area
The value area is the range of prices where about 70% of a session's trading took place. Its top is the value area high (VAH) and its bottom the value area low (VAL). It shows the prices the market accepted as fair.
Where the market spent most of its time
Take a session's profile and find the band holding about 70% of the letters. That band is the value area.
The number comes from statistics: roughly 70% of a normal distribution sits within one standard deviation of its middle. Steidlmayer used it as a practical definition of "where most of the business got done".
Its top edge is the value area high, VAH. Its bottom edge is the value area low, VAL. On the morning shown, value ran from 24,060 to 24,135.
How the band grows from the POC
The value area starts at the point of control, the busiest row. From there it grows one step at a time towards whichever side has more letters, until it holds 70% of them.
That is why value is rarely centred on the POC. On 18 June the POC sat near the bottom of value, because the morning spent more time above it than below.
Yesterday's value frames today's open
Value matters most the next day.
If NIFTY opens inside yesterday's value area, the market is still agreeing with yesterday. Expect two-sided trade until something changes.
If it opens outside value, above VAH or below VAL, the market is testing a new price. Either it builds value there and the move is accepted, or it fails and returns into yesterday's value. Watching which happens in the first hour is one of the most useful habits a profile trader can have.
The 80% rule
A well-known guideline: when price opens outside yesterday's value area, then gets back inside it and holds for two consecutive 30-minute periods, it often travels to the other side of value.
It is a tendency, not a law, and it is named after an observed frequency rather than a guarantee. Treat it as a reason to watch, not a reason to act.
The value area in AXL Charts
AXL Charts shades the value area on every profile and can draw the VAH and VAL as lines, with their own width, style and colour. Previous sessions' value stays on the chart, so you can see today's open against yesterday's value at a glance.
Watch
Learn Market Profile from Scratch | TPO, POC, Value Area & Initial Balance
Market Profile for NIFTY from the ground up: TPO charts, the point of control, the value area and the initial balance - and how to read acceptance and rejection instead of guessing.
Watch on YouTube ↗Market Profile for Beginners: How to Read a TPO Chart Before You Take a Trade
Reading a TPO chart step by step on a real NIFTY futures day, from the first thirty minutes to the close - value area, POC and structure - and a short pre-trade routine for whether to chase, wait or stay out.
Watch on YouTube ↗Questions
Why is the value area 70%?
About 70% of a normal distribution lies within one standard deviation of its centre. Market Profile uses that as its definition of the main body of trade.
What are VAH and VAL?
The value area high and value area low: the top and bottom of the band holding about 70% of the session's trading time.
Is the value area the same in Volume Profile?
The idea is the same, but Volume Profile measures 70% of the volume traded instead of 70% of the time, so the two bands can differ.
What is the 80% rule in Market Profile?
A guideline that when price re-enters the previous day's value area and holds for two 30-minute periods, it often crosses to the far side of value. It is a tendency, not a certainty.