The Euro FX and Market Profile

I have been working on using Market Profile for the truly 24 hour markets, such as the currencies. My current conclusion is to treat those markets, such as the Euro, in the same way that the big trading houses treat them.

Most of these trading houses have trading presences in the three major time zones: New York, London and Hong Kong. There are slight variations to the cities - Hong Kong may be Sydney, Singapore or Shanghai, but broadly speaking these are the areas where the trading originates.

These same houses run "trading books" - positions - that they pass around the world when each regional office stops trading for the day as the dawn is breaking and the sun heads west.

If you look at the markets, the usual human characteristics are evident. Everyone is different, and as the book is passed the local office puts it's own slant on things, adjusting the book in line with it's opinions and news.

So, I join these guys and start my Profile when Globex opens in the U.S. on Sunday afternoon (9.30 pm in London) and create 3 Profiles every 24 hours from that moment - each profile being 480 minutes (8 hours) long. This roughly meets the beginning of activity in the U.S. at about 8.30 pm NY time.

The Euro FX future looks like this in Market Profile:

I use each Profile as I use other Profiles. I split the Profiles as necessary and merge them too. But this is a good starting point for me.