medium · Order Flow Analysis absorption-exhaustion-imbalance

Why do markets typically fall faster than they rise, as explained through order flow mechanics?

1. There are simply always more aggressive sellers than aggressive buyers in the market overall.
2. Bids are often pulled during declines, and long liquidations trigger market sell orders that hit thin bids.
3. Buying is always considered a purely passive activity, while selling is always inherently aggressive.
4. The exchange imposes strict circuit-breaker limits on how fast prices can rise, but places no such limit on declines.

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