medium · Order Flow Analysis absorption-exhaustion-imbalance
RTH session for ZC opens at $372.00, which is exactly at the overnight low. The first bar shows stacked selling imbalances through $372.00 and $371.75 with a Δ of -900.
What risk-management action is appropriate for a trader who was long from the overnight session?
- Exit immediately, as the overnight support has failed with initiative institutional selling.
- Hold the long and wait for the 'Gap Fill,' since price now looks overextended lower.
- Wait for the 30-minute 'Initial Balance' period to close before making any decision here.
- Add to the long position, since the overnight low is 'cheap' here and buyers will defend it strongly.
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