The market as an auction

The market is a continuous auction looking for the price where trade is maximal: the value area. Everything else (trends, ranges, breakouts) is only the displacement of that search.

Two states, two games

• Balance (range): price oscillates around value, buyers and sellers agree on a zone. The extremes of the range are rejected: too expensive for buyers at the top, too cheap for sellers at the bottom.
• Imbalance (trend): price moves away from value to find participants. It is looking for liquidity: sellers higher up, buyers lower down. As long as it does not find enough, it keeps going.