medium · Order Flow Analysis footprint-delta

An order flow trader sees a red candlestick (bearish close) but the footprint reveals a 'Wick-Body Imbalance' where the upper wick has buying imbalances and the body has stacked selling imbalances.

What is the psychological state of the buyers in the wick?

  1. They successfully defended the Value Area High as buyers absorbed selling there.
  2. They are in profit, having bought near the low before price rallied.
  3. They are underwater and will likely sell to exit, fueling further decline.
  4. They are waiting to buy more as price retraces to their level, viewing it as support.

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