For those trading purely off the DOM: How do you differentiate between aggressive price movement that signals true momentum (likely continuation) and aggressive movement that's actually an exhaustion spike about to reverse? What specific cues in the order flow, liquidity changes, or pace of the tape help you make that distinction in real-time without chart context? Looking for specific DOM observables. Thanks.

onemorenik99 

For those trading purely off the DOM: How do you differentiate between aggressive price movement that signals true momentum (likely continuation) and aggressive movement that's actually an exhaustion spike about to reverse? What specific cues in the order flow, liquidity changes, or pace of the tape help you make that distinction in real-time without chart context? Looking for specific DOM observables. Thanks.

Hi One...

Look at Ask / Bid imbalances for tip off. If there is no obvious imbalance (30% difference), Fade the Move. If it's an area of breakout and there is a strong imbalance, take the trend.

Good luck

^Is it possible to get a visual example or a screenshot of what you just explained. Thanks.

Very nice new Axia video on use of DOM.

Hardly mentions or looks at the Bid/Ask. all about speed and range of movement..

being honest, I've removed the Bid and Ask from my Jigsaw as I'm not able/ good enough to use the info, less to mix me up...


By pure chance.... if you want to practice... there an identical move on MES and MNQ at 08.00 (UK) today, London Open, Friday 16 May

onemorenik99 

For those trading purely off the DOM: How do you differentiate between aggressive price movement that signals true momentum (likely continuation) and aggressive movement that's actually an exhaustion spike about to reverse? What specific cues in the order flow, liquidity changes, or pace of the tape help you make that distinction in real-time without chart context? Looking for specific DOM observables. Thanks.

I look more at the chart for these, but on the DOM is would be a heavy tape movement that isn’t fully continuous and surges then pulls back a bit (momentum & continuation) versus a sharp movement thats more deliberate and quick