See who is actually participating.
Traditional candles show where price traded. Order flow provides additional information about how participants interacted while price moved there.
Market Orders
Aggressive participants crossing the spread because they want execution now. Aggressive buyers transact against available asks. Aggressive sellers transact against available bids.
Limit Orders
Passive liquidity waiting for aggressive participants to transact against it.
This distinction creates the interaction between aggression and liquidity.
Absorption
Strong aggressive activity occurs but price makes surprisingly little progress. Example: large aggressive buying enters at EXT, but price cannot continue higher. That does NOT automatically mean short. It means buying aggression is being absorbed. Now watch what price does.
Exhaustion
Participation begins declining as the auction reaches an extreme. The market may simply be running out of participants willing to continue pushing the move.
Aggressor Flip
The dominant aggressive side changes. Example: buyers aggressively attack an upper EXT. Continuation fails. Selling aggression begins increasing. That transition can become part of Model 1 confirmation.
ORDER FLOW PROVIDES EVIDENCE. PRICE CONFIRMS THE TRADE.
FATBOOK combines order-flow information with Harmonia location rather than reading flow without context.
Next: where the orders behind that flow are actually resting.
Continue to Liquidity →