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The Point of Control (POC) is a cornerstone concept in volume profile trading. It represents the price level where the highest amount of trading volume occurred during a specified time period. Traders often monitor this zone as it may represent a fair value area based on historical volume concentration.
POC refers to the price level with the highest traded volume in a selected session. On a volume profile, it is usually marked with a horizontal line or highlighted as the longest bar. This level is seen as a consensus zone between buyers and sellers, making it crucial for spotting potential support, resistance, or trend development.
To calculate the POC:
A volume profile is created by plotting volume traded at each price level during a session.
The price with the highest volume becomes the POC.
This calculation does not rely on time, but rather volume distribution across price, offering a distinct advantage over time-based indicators.
POC is vital because it:
Acts as a magnet for price—markets tend to revisit this level
Highlights institutional interest, as large orders often accumulate near POC
Serves as dynamic support or resistance, depending on market context
Offers clues on market balance and potential breakout zones
Traders use the POC to gauge fair value and measure acceptance or rejection of prices around it.
Popular POC-based trading strategies include:
Pullback Entries: Price revisits the POC after breakout, sometimes noted in analysis
Reversal Setups: Strong rejection from POC with volume divergence observed
Defensive Zones: POC is often interpreted as a potential support or resistance where some practitioners reference tighter stops in analysis frameworks
Breakout Validation: POC shift may indicate new value area or continuation
Always confirm with price action or other indicators before acting on POC alone.
POC’s location within the Value Area (typically 70% of volume) can indicate:
Bullish Sentiment: POC near the bottom—buyers defended lows, price likely to rise
Bearish Sentiment: POC near the top—sellers stepped in, price may decline
Neutral Market: POC in center—market balanced, wait for breakout cues
It helps traders determine whether the market is accepting or rejecting current price levels.
Despite its usefulness, POC is not foolproof:
In ranging markets, price may hover around POC without clear direction
Acts as a magnet, attracting price but not always signaling a reversal
False signals if not supported by structure, volume trend, or momentum
Requires confluence with other tools (e.g., trendlines, indicators, LVNs)
Avoid using POC as a standalone signal as context matters.
Suppose Nifty50 had a POC at ₹22,000 during the prior session:
Price gaps up to ₹22,200 and then pulls back
Market participants may monitor ₹22,000 to see if price reacts near the previous POC
A bullish candlestick along with a volume spike might be interpreted by some as a sign of renewed buying interest
Some traders may view this level as an area of potential support, depending on broader context and confirmation from other indicators
Possible targets could include the value area high or any emerging breakout zones, depending on the evolving structure
This scenario illustrates how the POC may serve as a reference point for understanding price reactions, rather than as a signal in isolation.
The Point of Control offers a reliable reference for value, institutional behavior, and support/resistance zones. However, its real power lies in its integration with broader context and confluence tools. POC may inform entry timing, trend assessment, and risk awareness—but never in isolation.
This content is for informational purposes only and the same should not be construed as investment advice. Bajaj Finserv Direct Limited shall not be liable or responsible for any investment decision that you may take based on this content.
They use a Volume Profile indicator, which calculates volume traded at each price level and identifies the highest-volume level as the POC.
It represents the price where most trades occurred, signaling mutual agreement between buyers and sellers.
Yes. POC placement within the value area can reflect market bias—bullish, bearish, or neutral.
Common challenges with POC include over-reliance without supporting context, overlooking broader market structure, or applying it during thin liquidity conditions.
By identifying the price level with the highest total volume on a volume profile for a given period.
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