Market Profile: Anomalies - Ledges

all right so let's talk about another type of structural anomaly and these are Ledges so just as the word implies this is where activity literally just falls off a ledge right where a two-way activity is abruptly cut off and we don't have an even distribution within the structure so at a high like this this is a ledge but it helps form poor High when we're talking about ledges for the most part we're talking about within the structure more towards the interior of the structure although this is still a ledge so it's an area where activity

has been abruptly cut off and what we need are more than two tpos so here you can see that you have six tpos outside of this single TPO right here and what we have is again a non-even distribution so this would be a more gradual even distribution and then as you get towards the low you can see that it begins to pick up and become a little bit more sharp becomes a little bit more blunt so Ledges are areas where again activity is abruptly cut off and the trade is seen as incomplete what you're going

to see is something that looks like an abnormality within the structure so for an example right here this is a ledge this is a ledge all right you're going to have multiple Ledges within a structure okay you'll have some that again are more drastic than others and these are the ones you're going to want to pay attention to because remember Market profile is again it's a data organization tool so what we're doing is really we're just taking the activity throughout the day the micro support and resistances that were formed and when we're compressing them into

a profile we're seeing them much more obviously because we're starting to see where the high was for example so right here while this was the initial High into that level this was The Ledger was created afterward so the market came into this level for one two three four five six periods so six rotations up towards this obviously we didn't spend the same amount of time in each one of these but this is where trade was abruptly cut off for those periods so what it shows us when we're looking at a profile is the immediate sign

where supporter resistance was for example of where supporter resistance was for example in this case it being resistance so a ledge sets up two different types of opportunities it sets up for example since this was at the high multiple times it sets up a stop run and then from that it sets up a breakout with the help of a stop run so for the most part when I'm looking at very obvious Ledges I'm looking for potential breakout trades so if price trades back into them from the high you know if we're already past a ledge

well then maybe it's potentially a in this case a support Zone but on the way back through a ledge I'm looking for a breakout trade so for example here is a ledge right here this is an area where activity was abruptly cut off multiple times but more than likely as the market revisits this level for the in this case seventh time we're going to have some type of run through this liquidity so when you're looking at a ledge you're more often than looking more often than not looking at a potential breakout opportunity in advance so

what you should be doing is mapping out your structure according to where you currently are and where you sit with respect to previous Ledges so in this case we're looking at an example where we're actually through this ledge but price did take out these highs so this was a breakout through this ledge but you can see that after the ledge was taken it was treated as support so remember we're just looking at when we're looking at Ledges within structure we're really just looking at areas where price came into multiple times and it and it's and

it held up so it acted as resistance multiple times at that precise point or it acted as support at multiple times at that precise point and if we keep an idea of where these are in the future we could have an idea of where maybe potential liquidity sits on the other side of that so if we're looking to again take some type of breakout or break down trade