medium · Order Flow Analysis absorption-exhaustion-imbalance
An ES bar makes a new high at 4532.00 with 850 contracts bought on the ask and only 30 contracts sold on the bid. The bar closes at 4528.50.
What does the location of the Commitment of Traders (COT) suggest?
- Bearish reversal because heavy volume at the high was met by passive selling absorption.
- Institutional stop-running to clear out retail shorts.
- Bullish continuation as buyers are highly active at the high.
- Neutral balance as the volume is concentrated at one extreme.
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