medium · Order Flow Analysis absorption-exhaustion-imbalance
A trader is short 5 ES contracts based on a stacked selling imbalance zone. A new 5-minute bar forms showing a buying imbalance at the low and a strongly positive delta of +1,200.
What is the recommended action according to the 'conflicting-signals' protocol?
- Hold the position until the original stop at the stacked selling zone is hit.
- Exit at least half of the position or the entire position to lock in current profits.
- Add to the short position since the original stacked selling zone has not yet been breached.
- Move the stop-loss 10 ticks further away to give the losing trade extra room to work itself out.
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