medium · Order Flow Analysis absorption-exhaustion-imbalance
A trader notes a stacked buying imbalance zone at 365.00-365.50. Later, a pullback bar with a delta of -600 returns price to 365.25.
Should the trader still consider a long entry at the zone?
- No, the negative delta printed on this pullback bar completely invalidates the original bullish thesis.
- Yes, the trade is valid if the footprint at the zone itself shows bid volume declining and buy imbalances re-emerging.
- No, a pullback into the zone must show neutral delta throughout to be considered 'Safe' for a valid entry attempt.
- Yes, but only if the cumulative delta for the entire trading day remains solidly positive across all prior trading sessions.
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