POC Ghost Levels

POC Ghost Levels

Disclaimer
IMPORTANT: This indicator is for educational and informational purposes only. It is NOT investment advice, financial advice, trading advice, or a recommendation to buy or sell any security or financial instrument.

Overview
Point of Control (POC) represents the price level with the highest traded volume within a period, developed by J. Peter Steidlmayer at the Chicago Board of Trade (1981-1983). POC shows where institutional traders accumulated their largest positions, acting as strong support/resistance because institutions defend these levels.

Visual Elements
POC Lines (Horizontal): Teal/green lines show active POCs; orange lines indicate mitigated (revisited) levels. The line shows institutional accumulation zones.

"✕" Symbol (Period End): Marks when the calculation period ends (daily/weekly/monthly/yearly). POCs become valid trading reference points only after period completion—the X confirms this transition.

"●" Dot (Mitigation Point): Appears when price retests a POC level (High ≥ POC ≥ Low, or close within 10% of bar range). Virgin POCs (VPCs)—POCs not yet revisited—are even stronger price attractors than regular POCs, acting like gravitational pull that increases as price approaches.

"Ghost Effect": Extended lines represent market memory. POCs act as magnets where price gravitates toward in the future, representing "fair price" where most volume traded.

Trading Theory
All markets are auction processes seeking to maximize volume. Volume is the truest indicator of the market's ability to facilitate trade. Markets not facilitating trade at a given price will move to levels that better facilitate trade. Big institutions cannot enter positions instantly—they accumulate over time. POCs reveal where these positions formed.

Trade the first POC test for highest probability success. In trending markets, POCs confirm trend legs; in ranging markets, POCs act as central magnets.

Key Literature

Steidlmayer, J.P. & Hawkins, S.B. (2003). Steidlmayer on Markets: Trading with Market Profile (2nd ed.). Wiley.
Dalton, J.F., Jones, E.T., & Dalton, R.B. (2012). Mind Over Markets: Power Trading with Market Generated Information. Wiley.
Dalton, J.F., Dalton, R.B., & Jones, E.T. (2007). Markets in Profile: Profiting from the Auction Process. Wiley.
Jardine, M. (2012). Just a Trade a Day: Simple Ways to Profit from Predictable Market Moves. Wiley Trading.