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 and wait for the 'Gap Fill' since the market is overextended.
- Wait for the 30-minute 'Initial Balance' to close before making any decision.
- Add to the long position because the overnight low is 'cheap' and will be defended.
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