Recognizing Absorption In The Order Flow At The High Of Day

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Understanding absorption in the order flow is an important component of successful trading. Absorption is essentially where buying and selling meet in terms of liquidity, which can tell traders a lot about the current market sentiment.

Absorption in the order flow highlights how swiftly orders are accepted and executed, which can provide traders with a better understanding of market liquidity. This could be used to infer how quickly the price may move or make decisions regarding when to enter or exit a position. Understanding and tracking absorption can provide insight into finding potential trading opportunities, as quick action on any changes in market prices can help generate profits.