medium · Order Flow Analysis market-mechanics-execution
An ES trader notices that at the session high of 4535.00, there is a bid volume of 500 but the ask volume one tick above at 4535.25 is 0.
What should the trader expect when price returns to this level later in the session?
- Nothing, as 0 volume at an extreme is normal market behavior.
- Increased volatility as the market seeks to 'complete' the auction.
- A guaranteed reversal because the 0 volume indicates absolute rejection.
- Consolidation because the market has found its maximum range.
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