The value area is where most trading volume happens, marking fair value. When price leaves it on declining volume, that's a test. When volume rises as price returns to the value area, that's your entry signal. Stop goes at the extreme of the move outside.
Every time price leaves the value area, it's running a test. The value area is where the most money was traded. That is fair value. Buyers and sellers agreeing on what's a fair price to trade. When price pushes outside of it, the market is asking a simple question: Is there enough money joining the party? Watch the volume bars that move outside. If volume is declining, the answer is no. The money is not following price. The party did not leave with it. Then price comes back inside the value area. As it does, volume starts picking up. The money is clearly gonna stay back where it was. So that's your entry. Stop goes at the extreme of the move outside.
