Trading term

What is Value area?

The value area is the price band where roughly 70% of a period's volume traded, bounded by the value area high (VAH) and value area low (VAL). Inside it the market agreed on price; outside it, it didn't.

Take a volume profile, start at the point of control, and expand outward — adding the next-busiest price above or below — until the enclosed volume reaches about 70% of the period's total. The band you end up with is the value area, and its edges are the VAH and VAL.

The 70% figure comes from the market-profile tradition, where a session's distribution is treated like a bell curve and 70% approximates one standard deviation. It is a convention rather than a law, but it produces a consistently useful split: prices inside the band are where the market did most of its business, and prices outside are where it tried something and found few takers.

That gives the edges their meaning. Price accepted outside the value area suggests the market is repricing; price rejected at the edge and pushed back inside suggests the old range still holds. Many traders trade the edges rather than the middle for exactly this reason.

Where ~70% of the business happened
PRICEVOLUME AT EACH PRICE →VAH · $102.40VAL · $100.40~70% of all volume sits in hereExpand out from the POC until ~70% of the volume is enclosed. The edges are what you trade.

Expanding out from the point of control until 70% of the volume is enclosed gives $100.40 to $102.40. Those two edges, VAL and VAH, are the actionable part.

For example

A session's profile has its point of control at $101.50. Expanding outward until 70% of the volume is enclosed gives a value area from $100.40 (VAL) to $102.40 (VAH). Price pokes to $102.90 the next morning, fails to hold above the VAH, and rotates back down through the value area.

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Why it matters to you

The value area converts a fuzzy notion — 'the range' — into two measured prices you can act on. Knowing where value ends tells you when a move is a genuine breakout into new territory versus a probe that will get rejected, which is the difference between joining a trend and buying the top of a range.

⚠ 70% is a convention, not a physical constant

The value area is a descriptive statistic borrowed from market profile, and different platforms compute it slightly differently — some by volume, some by time at price. Treating VAH and VAL as exact, universally-agreed prices leads to over-precision. They mark where value roughly ends, and should be traded as zones.

Frequently asked questions

What is the value area?

It's the price band containing roughly 70% of a period's traded volume, centred on the point of control. Its upper edge is the value area high (VAH) and its lower edge is the value area low (VAL).

Why is the value area 70%?

It comes from the market-profile tradition, which treats a session's price distribution like a bell curve where about 70% of observations fall within one standard deviation. It's a useful convention rather than a mathematical property of markets.

How do you trade the value area high and low?

The edges are the actionable part. Price rejected at the VAH and pushed back inside suggests the range holds; price accepted above it suggests the market is repricing higher. Many traders fade the edges in a balanced market and follow breaks of them in a trending one.

What does it mean when price trades outside the value area?

It means the market is testing prices where little business was done. If it can't attract volume there it usually rotates back inside; if volume builds at the new level, value is migrating and the range is shifting.

Related terms

Anchored VWAPAnchored VWAP is a volume-weighted average price that starts from one candle you choose, rather than resetting at the start of each session. You anchor it to a meaningful event — an earnings gap, a major low, a breakout — and it tracks the average price everyone has paid since.Ascending triangleAn ascending triangle is a bullish continuation pattern: a flat horizontal resistance line on top, with a rising trendline of higher lows beneath it. As the higher lows squeeze price against the ceiling, pressure builds — and it usually resolves with a breakout up through the resistance.ATR (Average True Range)ATR (Average True Range) measures how much a security typically moves in a period — its volatility — as an average of recent trading ranges. It doesn't say which direction price is heading, only how far it tends to travel, which makes it a core tool for stop-losses and position size.Bearish engulfingA bearish engulfing is a two-candle reversal pattern in which an up candle is followed by a down candle whose body completely covers it. The second candle opens above the previous close and closes below the previous open.
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