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How To Read the Depth of Market (DOM) — Transcript

by Jon Watkins · 6,369 words · 887 segments · language en · Watch on YouTube

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0:00In the last three episodes of this
0:01orderflow series, we talked about
0:03auction market theory using footprint
0:05charts and bookmap to find trade setups.
0:07And in this episode 4, I want to
0:09introduce you to one of the most
0:11important tools for any trader, and that
0:13is the depth of market. It provides key
0:15information that allows me to find
0:17quality setups and make the best trading
0:19decisions every day. The depth of market
0:21is the order book, and it shows us how
0:23buyers and sellers are interacting by
0:25price. If you haven't watched those
0:27first videos yet, I will add the link in
0:29the description down below. Also, I
0:31recommend that everyone go and follow my
0:33Instagram. I post really great trading
0:35tips and trading recaps which can be a
0:37really great resource for you to learn
0:38from. Now, let's take a deeper look into
0:40the depth of market. All right, let's go
0:43over the depth of market or the DOM. In
0:45this video, I'm going to tell you what
0:47the DOM is. We're going to talk about
0:48how to use it, why it's beneficial, the
0:52function of it as a orderflow tool, and
0:55we're going to go over how you can use
0:57it to kind of figure out if there's
1:00going to be like a short-term move up or
1:01down without looking at a candlestick
1:04chart. So, first, what is the depth of
1:06market? The depth of market or the DOM
1:09shows us the order book. It shows us the
1:11price ladder of participants and it
1:13allows us to place buy and sell orders.
1:16And it shows us completed transactions
1:18and volume by price. So before we get
1:21into the lesson, I want to bring your
1:23attention to this picture which is of a
1:25New York professional trading floor. And
1:28I want you to pay close attention to
1:29their screens. Some of these firms have
1:32million-doll traders that are like
1:35professional traders. And what you
1:37notice is all these computers right
1:40here. These are DOMs. These are price
1:42sliders. These are depth of markets.
1:44What do you
1:45notice? Are there more candlestick
1:47charts or are there more depth of
1:49markets? This guy's got a volume profile
1:52right here. This guy has got three or
1:54two screens of volume profiles. And what
1:57do you see? This guy has three different
2:00monitors with depth of markets. He has
2:03three monitors with volume profiles. And
2:05then he has like, look, he has like one,
2:06two, three, four. He has like five tiny
2:08little charts. So the charts are just
2:10reference points and he's majorly
2:13focused in on the actual order book and
2:16the depth of market. This guy's got it
2:17in the front screen. This guy's got it
2:19right here. There's one over here. This
2:21guy has some charts right here. But you
2:23can see that the the screen is not
2:25dominated by charts. Most of their
2:28screen real estate is given to the depth
2:30of market, the price ladder, and
2:32orderflow tools. I want you to keep that
2:34in mind that like there are people on
2:36Wall Street or traders wherever that
2:39make tons of money and they're not even
2:41looking at candlestick charts. Like
2:43there there's guys that trade without
2:45looking at a candlestick chart. And most
2:48of you are probably thinking that's
2:49crazy, especially if you most of your
2:52education comes from
2:53YouTube. You know, everything is is
2:56about candlestick charts and moving
2:58averages. And there seems to be like not
3:01as much info going on behind order flow.
3:03So I want you to keep that in mind as we
3:05kind of go through this lesson as you go
3:07through any orderflow content on my
3:09channel or anywhere that you know price
3:11is ruled by buyers and sellers and
3:14volume. And the candlestick charts all
3:16they do is show you a visual
3:18representation of what's going on but
3:21the magic is happening on these price
3:24ladders and these depth of markets. That
3:26is the actual order, you know, order
3:28book where buys and sells are being
3:30placed. If you're an ICT trader, smart
3:33money concepts, all those things, that's
3:35fine. Indicators, moving averages, RSI,
3:38what, whatever you're
3:39using, the market goes up and down
3:42because an order is placed, right? An
3:45order is placed to buy or sell. And
3:47whether there's more buyers or more
3:48sellers at a specific price, the market
3:50will move up in that direction. It's not
3:52because your
3:53ICT strategy thing, whatever they call,
3:56whatever names the the guy has for them,
3:58whatever ICT thing you're seeing on the
4:00chart, that's only working because there
4:04are traders at that price placing buys
4:06and sells. So, keep that in mind. So,
4:08this is a depth of market. This is mine
4:11from Motive Wave. You can kind of
4:13customize these, but every depth of
4:15market is going to kind of like have the
4:17same functions of what's going to be on
4:19here. So I'm going to start with the
4:21middle column first which are these four
4:24right here which is the bid the at bid
4:26the at ask and the ask. So the bid is
4:28the limit orders. This is your level
4:30two. This is your your limit buys or
4:34your passive buys. So if you are in no
4:37rush and you want to buy at
4:39630 you can click this place a buy and
4:43then for one contract and this 128 will
4:46turn into 129 and your order will be
4:48waiting there.
4:50On this pink side right here, you have
4:52the ask, which is your passive sales.
4:55So, if you want to buy at
4:566,35, you would click right here, and
4:59the 230 would now say 231 with your one
5:02lot order. All right? And then you are
5:04now a passive seller in no rush. This
5:07atbid at column is going to be your
5:10market orders, which are completed
5:12transactions. Now, if you if any of this
5:14is confusing, I would I would definitely
5:17tell you to watch the auction market
5:19video, which is the first video in this
5:21episode, which goes over how auction
5:23market theory works. You're confused by
5:25any of that, I suggest watching that.
5:27Um, it might give you some key context,
5:29but market orders are filled by limit
5:31orders. All right? So, the middle is
5:34market orders, and they're colorcoded.
5:35So a market sell has to hit the bid in
5:39order to be a completed transaction and
5:41a market buy has to be hit has to hit
5:45the ask to be a completed transaction.
5:46The at ask is market buys and the at bid
5:51is market sells and they're colorcoded.
5:53This column right here is your bid and
5:55your ask volume. So this middle column
5:57volume is going to be right here. These
5:58are completed transactions. All right.
6:01So these are you can see the histogram
6:03and like the profile. um if there's more
6:06market buys or market sells at that
6:08price. And it shows your total volume
6:10profile. So the volume right here is
6:13going to be the total of these combined.
6:15So 375 + 0 is
6:19375. 303 + 69 is 372, right? 780 + 543
6:26is
6:281323. That's the volume. And then the
6:30delta volume is going to be your ask
6:32minus your bid. So ask minus bid. So 375
6:36minus 0
6:38375. 303 minus 69 is 234. And then you
6:43come right here like 1550 minus 1834 is
6:47going to be -284. All right. And that's
6:50how those columns are populated. That's
6:52the math of it. And then you can see a
6:54histogram or a volume profile to see
6:57where the volume by price is thicker or
6:59lighter. So, just to recap, I have these
7:01colorcoded to correspond with the chart.
7:04A market buy is an aggressive order
7:06hitting the ask, which would be this 99.
7:09And a market sell is an aggressive order
7:11hitting the bid, which would be this 62.
7:14A limit buy is a passive order waiting
7:16on the bid, which is this blue column.
7:19And then the red column is a limit sell
7:21passive order waiting on the ask. All
7:23right. There's always a buyer and a
7:25seller for every transaction. If this
7:27column in the middle is empty and there
7:30is no one placing market orders, the
7:33market will not move up or down, the
7:35these four these limits, these bids and
7:37asks do not fill each other. There has
7:38to be uh someone willing to hit the
7:41market to ask. Think of it like a
7:43housing market. If you are willing to
7:45pay 390,000 for a house and you place a
7:50buy for 390 and there's one house in
7:53that neighborhood, the guy that owns the
7:55house only wants to sell it at 400,000.
7:58What's going to happen? Nothing, right?
8:00The house will not be sold. But if
8:02someone else comes in and says, "Hey, I
8:04will pay for 400,000 for your house
8:06right now." Then you would have a
8:09completed transaction and then the
8:10market would move up, right? or someone
8:12comes another house you know you have
8:15your buy at 390,000 and then a guy now
8:18in the neighborhood goes hey I'll sell
8:19my house for 390,000 right now and then
8:22you would have him market sell to you
8:24and then you would buy your house for
8:25390,000 that's the basics functions of
8:28you know how a market works and it's the
8:30same thing in the stock market so in
8:33order for price to move up right here
8:35and go up to 33 and a quarter you would
8:38there's 71 right now waiting on the ask
8:40so you would need 71 orders to come in.
8:44And this would actually say 72 cuz
8:46there's already one right here. You
8:47would need an additional 71. But just to
8:50keep it simple, if 71 traders market
8:54bought at the ask, then these orders
8:57would be filled. You would see 71
9:00increase on this side. You would see
9:04this 135. It would now say
9:07206, right? 135 + 71 and then the volume
9:11would grow by 71, right? Which would say
9:14what, like
9:162,498. And the market would move up. In
9:19order to move down, you would need, you
9:22know,
9:2375 traders to market sell at this
9:276,3250 and then the market would move
9:30down to facilitate that trade. All
9:32right, that's kind of the basics of it.
9:33But we're going to watch a live video of
9:35the DOM moving and I'm going to like
9:37break it down further for you. We still
9:39want to understand like how the depth of
9:41market is working and how these like
9:43middle trades and remember this middle
9:44column right here is market
9:46orders. So you have a heavier sellside
9:49book right here. You have more
9:52sellers willing to offer at these prices
9:56than there are buyers willing to buy
9:58down here. And then in this column, now
10:01this is the key thing right here is, you
10:03know, there's a lot of sellers here. The
10:05buyers are are trying to buy, but you
10:08know, let's say price move down to six
10:10and, you know, 100 lots hits the bid,
10:14but then 50 comes in on the ask. So,
10:18there's not a lot of buying pressure,
10:19right? In order for price to move up, in
10:21order to be watching this and think that
10:24buyers are going to continue to move
10:25this up, you would want to see like 9
10:28950 hit and then kind of like close out
10:31these sellers and then move price up.
10:34But because there's only 50 right here,
10:36the buyers aren't that strong. And all
10:39the sellers have to do is come down and
10:42hit another 400 contracts under this.
10:45And then that would clear out these
10:47buyers. And then price would now move
10:49down. And if they hit 350
10:51here, price would also move down. You
10:55see that happen right here, right? These
10:57are the same
10:58charts. I wanted you to understand the
11:01math. You have you already have 100 and
11:03you have 400. So 400 more comes in.
11:07That's why this says 500. All right? You
11:10already have the 100 here. So you have
11:11400 come in. 400 plus 100 gets you that
11:15500.
11:17And then this one was just 350. And then
11:19now you have 350 here. So the buyers
11:21only hit 50 contracts and then the
11:24sellers pressed with
11:255350. They cleared out the book on the
11:28bid right here. And then price moved
11:30down and then the sellers are still
11:32offering. So, you really would need to
11:34see like let's say you saw 100 right
11:37here and then you saw 800 come in right
11:42here and then you saw like 700 show up
11:46here and like price starts to move up
11:48and you're seeing lower numbers on the
11:50at on the at bid and you're seeing
11:52higher numbers in this market column
11:54right here. then that's the clue that
11:57the buyers are now pressing in higher
12:00and they're willing to buy down here at
12:01these lower prices and the sellers are
12:04not willing to sell down here at lower
12:06prices. Right? If you're a seller, you
12:09would rather sell up here at
12:118 than down here at four, right? And if
12:14you're a buyer, you would rather, right?
12:18Would you rather buy at five or maybe
12:20you want to buy down here at three? So
12:22buyers always want like lower prices and
12:24sellers want higher prices. So you get
12:26to a point where eventually the buyers
12:28are going to step in and you can see
12:30that when you see size starting to be
12:32pressed that clears out all the levels
12:35right here and then you see like less
12:37size on the right or less less less size
12:39on the left. Here's a heavier buy side
12:41chart, right? You have 1,200 at 5, 1,000
12:43at 4. There's less sellers willing to to
12:46sell up here. Now, even though the
12:47sellers are pressing hard, the buyers
12:50are are are hitting a little harder. So,
12:52there's 400 cons right here, but they
12:54come in with 700. So, you know, then
12:56maybe price moves up and then you would
12:58want to see this 600 grow by another
13:01another 700 contracts. If you saw 700
13:05come in again, then that's clearing out
13:06this price and then that's how price
13:09would move up. So these middle columns
13:11are very important to judge whether
13:15price is going to move down or is going
13:18to move up and based on how these market
13:21orders are filling at the bid or at the
13:23ask. Just having large numbers on this
13:26column, it's like yes, it's heavier buy
13:28side, but this doesn't show intention,
13:31right? I can place an order for
13:349,850 contracts at $3. If price comes
13:38down to three and then I cancel the
13:39order and I lift my my my bid, doesn't
13:43mean anything, right? But if you see
13:469,000 right here in this column, like
13:50let's say this is 9,000 waiting. If
13:53there's 9 I'm just going to keep it I'm
13:54just going to say 900 to keep it keep it
13:56simple. If you see 900 right here, this
13:58850 doesn't mean anything until you see
14:01900, then you know that is a completed
14:04transaction and 900 sellers market sold
14:08and hit the bid and filled at $3. All
14:11right, completed transactions matter.
14:14This doesn't matter so much. It helps us
14:17kind of look and and to see that there's
14:19more sellers and there's heavier sell
14:21side and there's heavier buy side right
14:23here. But what matters is completed
14:26transactions because that's where you
14:27can see intention. Now, let me kind of
14:30go through this video right here and
14:33we're going to see a DOM work and I'm
14:35going to kind of pause it and play it
14:36just to kind of show you what's
14:38happening. So, again, we have the market
14:40orders in the middle, we have the book
14:42on the left, and we have the the sellers
14:44on the right. So, we can see how price
14:46is moving down. We're going to kind of
14:47look at this and judge like, are we
14:48going to kind of move up? We're going to
14:50kind of move down. I'm going to pause it
14:51and play it frame by frame. So we saw
14:53this 135 go to 142. Now remember if we
14:57want this to go down this 8 needs to get
14:59bigger or to go up like the 29 or the 43
15:03like we want to see more size on the
15:05right. So if I pause and play it that 8
15:08went to 13 that now it went to 20.
15:11There's 11 right
15:13here. 25 now 25. And then now now this
15:17goes to 20. It's at 27. So, in order to
15:20move down, 47's got to get bigger. More
15:23traders got to sell at at either
15:2679.50 or at
15:287975. More traders have to
15:33buy. I'm trying to do it frame by
15:36frame. So, you see one order come in and
15:39it moves up. So, only one seller sold at
15:4579.25. I'm going to backtrack that we
15:48can see. So there's 47 now. One
15:54hits. See if you caught
15:57that. So one hits. This says
16:0148 and then it goes to 59. And then this
16:05142 didn't change. All right. So we bit
16:07up because more traders hit the ass
16:09right
16:11there. This column refreshes like every
16:13200 milliseconds.
16:17So that's growing to
16:2039 and then sells come in. It moves down
16:22a few
16:24ticks. I'm going to keep going. This is
16:26going to make sense. So now there's 111
16:28market buys. We're moving
16:31up to kind of play
16:34this. All right. So now we're coming
16:36into the
16:38low. All right. One contract hits at 79.
16:42So boom, right there.
16:44272335
16:4611611. All
16:48right, more sellers hit the bid. Price
16:51moved down and there was weak buying.
16:53Now what happens next? Now buyers step
16:56in right after and they push this up to
16:5843 16 28 one comes in 29
17:0346. You're seeing more size right here.
17:0677 it grows to 78. Buyer step in right
17:09there. Right. This column grows now 61.
17:11buyer step in again. Let me let me
17:14backtrack that again. So, we're sitting
17:16here
17:19368. That six doesn't change and we hit
17:2233 contracts now at
17:247975
17:2623
17:2834 65 72
17:3182. So, what we're seeing right now is
17:34even though we get these moves down, the
17:37buyers step in right after and kind of
17:39bring it up. So, we're not looking at a
17:41candlestick chart. We're just watching
17:43this column. And then boom, buyers step
17:45in
17:46again. Sellers try and bring it down.
17:49There's 78 here at the low. And then
17:52269, right? What do you see right there?
17:55269.
17:56387
17:5838731. We hit down this. We hit this low
18:01and then buyer stepped in on the right.
18:03We saw bigger numbers grow. That's why
18:05price is not moving down. You don't just
18:07see 78 and think that there's big size
18:11and we're going to move lower because
18:13you would need to see continued size hit
18:16and outweigh the buyers as we move down.
18:19If someone hits 78 market sells at 7850
18:23and then right after
18:24that buyers hit 38 731 more buyers press
18:28higher the market's going to move up and
18:30that's that's what you're seeing happen
18:31right there. grows to
18:3490, 109,
18:38116, 128, 141, and then boom. And it
18:42moves up. Can even Let me Let's like
18:44kind of go slow here and and pause and
18:47play frame by frame. So, we're looking
18:50at this 13 and this 18 that grows to
18:5419. We move down. Buyers still buying at
18:597950. It's growing to 133, 136.
19:05141 21 and 16 and then boom
19:09266. All right, that 18 didn't change.
19:1226 orders came in on the buy side and
19:15then six came in on on the uh on the
19:17bid. Then 12 and three, seven and five.
19:20All right, so the reason we're moving up
19:22is because there's more b there's more
19:24buyers market aggressively buying at
19:275980. Let me try and find There we go.
19:30This is a good point. So, so we're
19:32sitting here at this low. We're in this
19:33tight like little threepoint range right
19:35here. So, you're just watching the book,
19:37watching these orders. It moves down 79
19:40again
19:42101 35 and then 68 comes in right after
19:46the sellers are trying and then boom,
19:47buyers press in and move it up. So,
19:49right there, what we can deduce from
19:51that, we're now looking at a candlestick
19:54chart. You're seeing size come in on the
19:56on the bid, right? you're seeing large
19:58sellers, but right after we hit these
20:01low prices, buyers step in right after
20:03and and push it
20:05up. So, you can tell just off this price
20:08action that we're not breaking a low and
20:10there's size hitting by the sellers, but
20:12we keep moving up after and the buyers
20:14are willing to buy. So, without looking
20:16at a candlestick chart, you can already
20:17start to create a bullish bias that this
20:20thing can move up. And if you're
20:22scalping a couple ticks, a couple points
20:23with size, you know, that's how that's
20:26how they, you know, read this without
20:29looking at a candlestick chart. If you
20:30think, how can I just figure out if it's
20:31going to go up or down? You can see the
20:33size right there. And then the buyer
20:35step in right after move this up. So,
20:38it's not something that I want to really
20:40short because there's interest from
20:41buyers. And you can see the delta right
20:44here growing right to 600. At
20:467975, there's heavy buying, right? Way
20:49more than any other price point.
20:54So, I hope this makes sense. Uh, if it
20:57doesn't, you can always kind of rewind
20:58or like pause this video. But this is,
21:02you know, this is the depth of the
21:03market moving in real time. And if
21:05you're zoned in, I zone in at key
21:07levels, at price
21:09levels and watch the book to see if I
21:12want to get in a trade or get out of a
21:14trade if I'm in a trade. Right? If
21:17I'm if I'm short right now and I see
21:20this action, I'm not going to be that
21:22comfy because even though we move down,
21:25the buyers press in right after and they
21:27move us
21:31up. So, we're holding at 79. Look at the
21:33delta is growing. I'm going to like
21:34pause the video. We're at 251. I come
21:37back here to like a minute ago, it was
21:39at
21:40575. Now at 20 251, it's at 638. So at
21:457975 there's a lot of buying volume. All
21:48right. There's buyers willing to buy
21:50there. We get above this this grows and
21:52then boom we shoot up 83. So right
21:55there. So before this push
22:02up. We're sitting at 79. And we saw this
22:06bigger sell volume come in. Let me just
22:09rewind right here. All right. Well,
22:10watch this. It goes to 112. It grows
22:13129, 137, 144, 157. We're moving up,
22:18right? If there's tons of selling, why
22:19aren't we moving down? And then this
22:21thing shoots
22:23up. All right? And at that point, right,
22:26we're at 251 at this point right here
22:29when we're at 79 to 80. I would I'm
22:32telling you that there's like a bull
22:34bias in this that the sellers are trying
22:36to put it push it down and they're using
22:38size and then the buyers come in right
22:40after
22:42and they push it
22:44up. And then what happens next? You get
22:46this, you get this nice big move up into
22:49the 82s, 83s, and then it creates zero
22:52prints right here. This means that there
22:53was no volume traded on the bid. Now,
22:56when you see zero prints, this typically
22:59means they usually get filled pretty
23:00quick, and it's something I pay
23:02attention to, especially at highs when
23:03there's no volume. But now, we're moving
23:06up. And then, what do you see about the
23:08book? When I when I say the book, I mean
23:10the limit orders, the ask and the bid.
23:12We pushed up into 83 now, right? There's
23:15a lot of buying pressure right here. But
23:17if you look at the level two, it's kind
23:20of skewed heavier to the cells, right?
23:23We have 124, 63, 98, 52, 103. And if you
23:28look in this area right here, there's
23:30actually not as many
23:33buyers waiting to buy right here. And
23:36there's more sellers willing to sell up
23:37here.
23:39If you're maybe you're a scalper with a
23:42ton of size and you got in at 80 when we
23:45saw this area being defended, maybe it's
23:50a a trader at 80 and he wants to get out
23:52at 8485. I mean, you don't know the
23:53agenda, but we can just see the book.
23:55The book is kind of skewed short now.
23:58So, now you see buyers coming in. I'm
23:59going to rewind this. Now you see buyers
24:01trying and pressing harder. All right,
24:04move up to 83. Look at this column right
24:06here. 68 and the 12 and the
24:09four it goes to
24:1278 goes to 104 228 very quick look at
24:17that I'll rewind in about 1 second it
24:20goes from
24:2578 to
24:28104 we move down 190 all right so 80 85
24:32you can actually see it right there see
24:34that 86 that 86 is is a recent trade. So
24:38someone hit 86 lots or 86 lots were
24:40traded at 83 right there to the buy.
24:43That's what that green is and that's why
24:45it increased by
24:4686 110
24:48now
24:54red. Now it's 228 230. All right. Now it
24:58moves down 253. So now what do we see?
25:02Now you can kind of see this change in
25:04momentum, right? There's a lot of buying
25:06going on. We're pushing into this higher
25:08liquidity
25:10area and you want to see buyers continue
25:13to
25:14press otherwise the market will have to
25:17move down to facilitate trade. The
25:18market moves up to the last buyer buys.
25:20All right, the book is heavier on the
25:24ass side than the bid. You're seeing
25:26buyers come in and you're seeing sellers
25:29and so you want to see that continued
25:31strength. And now there's strong buying.
25:33And now the sellers are coming in. All
25:35right. Now there's heavier side. There's
25:38heavier sellers right at the bid right
25:40here. 155 106 52. Sellers are
25:43aggressively selling right here. And
25:44this could be I mean if you're a trader
25:46at 80 that's scalping for four points.
25:48Maybe you're trading 50 contracts. Maybe
25:51it's a floor trader and they just wanted
25:52to get four points. Now he's now he's
25:54selling. You don't know. I'm just giving
25:56you a possibility. But we saw the book
25:58flip. We see a thicker ask and now we're
26:01starting to see selling step
26:04in after this move up. And so you want
26:08to see buyers continue to press in order
26:10to move higher. And we have these zero
26:12prints down here. And like I said, those
26:13usually get filled pretty quick. And
26:15then what happens? I mean, it drops
26:17three points very fast. We can rewind
26:19that to see it again. We get up here to
26:238425. It grows to 30. We have seven.
26:28It goes to 48 and then it drops. So, I'm
26:31going to rewind that one more time. I
26:33hope this isn't too confusing for you
26:34guys. I'm trying to like make it as
26:35obvious as I
26:39can. So, when it gets to 48, I'll pause
26:45it. It's 30. All right. 48. I'll go to
26:4846. I'll go to 47. Okay.
26:58All right. So, it hit it hit 48 and then
27:0022 came in right after. So, in order for
27:03price to move up and continue higher,
27:05you need to have buyers willing to
27:07buy at 848425. And if this column grows,
27:11price will move
27:14down. And you can see as it refreshed
27:17and the and the new volume comes in,
27:20there are more sells than buys on the
27:22left column. and price moves down. All
27:26right, 58 and 4, 45 and 35, 33 and
27:3118, and we fill those zero prints and
27:34now the market moved down. So, just to
27:36kind of recap, all right, at the
27:38beginning of the video, we
27:42saw this strong selling and every time
27:46we for this first two minutes, every
27:48time we came down into the 7978s, the
27:50buyer stepped in and pushed it up. Then
27:54when we moved up into the 83s, 84s, we
27:57saw the book flip and we see heavier
28:00limit sells on the right, heavier
28:03sellers, and then we start to see
28:06aggressive selling step in after. And
28:09you kind of see the book flip and you
28:10see it change. All right, we know the
28:11zero prints down there. So, if I'm long
28:14and I see a thicker book and I start to
28:17see heavier size being traded at the bid
28:20and there's zero prints down here, I'm
28:22scared of my long or if I'm short, I
28:24have conviction to get in
28:27short. But that's how you can watch the
28:29order flow at certain levels. It can be
28:32very fast sometimes, but you train your
28:34eyes. You get you get good at it. You
28:36see these orders being printed and you
28:39can kind of make your judgment call. All
28:41right. If you wanted to get in short,
28:42you get in short right here at 84 for a
28:46couple points for these zero prints to
28:48fill and then it moves down and it gets
28:50filled three points. And that's what
28:52some of those floor guys are doing.
28:53They're trading with a ton of size and
28:55they're go they're scalping and that's
28:57what scalping is. I go for 10, 15, 20,
29:0025 points, 30 points on a trade, but
29:03when I get to lows or highs, I I'm
29:05watching this. So
29:07pretend, you know, pretend there's a a
29:11key level here, right? Pretend this is
29:14resistance
29:18and we're pretend this is a candlestick
29:20chart. All right. And we come into the
29:22resistance area right here. We hit
29:2584. And then I'm watching the book and I
29:28start to see, all right, we need to see
29:31buyers press up. All right, they go
29:32above my resistance by one tick.
29:368425. Maybe I'm in short. All right, I
29:38start to see heavier size come in on
29:40this side. I'm short at resistance. I'm
29:42seeing heavier size come in. All right,
29:45the buyers push up one tick. They can't
29:48get the thing any higher. Oh, and then
29:49it just drops right there and then
29:51seller come. There's seller ensues and
29:53then zero hits. So, I hope that kind of
29:55makes sense. But, you know, if you're
29:58playing resistance, like if my
29:59resistance is at 84, now I'm watching
30:02the book to kind of gauge the
30:04reaction at my level to see if the
30:08buyers or sellers are more strong. Now,
30:10I'm going to show you a recording I have
30:11next to a candlestick chart. And I just
30:13want to like highlight how if you see a
30:15big number like at a psychological level
30:17like 5700, it doesn't necessarily mean
30:21that you want to get in short because
30:22that number is greater. All right?
30:24Sometimes it can. But again, you know,
30:27here's the Globex high was
30:2956.99. It's coming into this key level,
30:32right? It's a psychological level.
30:34There's this higher low and this bounce
30:36getting put in. So, are we going to
30:37reject right here and come back down or
30:39are we going to like break out and go
30:41higher? All right. So, now we're zoned
30:43in on the on the order flow. You can see
30:45this thing push up into
30:47700. It was at
30:50395. We move up into it. There's only 98
30:53orders hitting. All the actions traded
30:55at 6975. All right. What does that 342
30:58mean? 325. Buyers are are are
31:01aggressively buying this psychological
31:06level. If I can get my mouse out of the
31:08way, it' be better. So, we're watching
31:11the reaction here at 5700. You don't
31:13want to just put your your cells right
31:15here and think that this is going to
31:17drop. You want to gauge the reaction at
31:19it. Watching the order flow.
31:23Watching this middle column, right? The
31:24at
31:29ask. Fast forward
31:32it. You can see this number constantly
31:34trading, constantly tra uh changing. So
31:37orders are traders are lifting orders,
31:40right? They're not leaving them the
31:41whole time. Some guys are probably
31:44canceling their short because they think
31:45it's going to go higher. doesn't it
31:48doesn't show intention until it gets
31:50filled and you see this hit. All right,
31:53but if you're trying to short this high
31:55and be a first seller and you're getting
31:57in right
31:59now. All right, let's see what
32:04happens. Size hitting
32:082349. Sellers are trying and we and then
32:11boom, buyers step right in 280. This
32:13delta is growing. You see the delta
32:14right here, right? Tons of buying at
32:16this high right here. Tons of buying.
32:18This is at 315. So, the sellers are
32:21trying to move it down and then the
32:22buyers just come in and then take it
32:25higher. And then you get to 5700 and
32:28then boom. I mean, it just shoots right
32:30up. I'm going to pause it frame by
32:33frame. So, here we are. Look how quick
32:36that was. I mean, in a millisecond there
32:38was 279. This hasn't tra This hasn't
32:41changed yet. 279 orders at the ask and
32:44then 279 buys come in. Zero prints are
32:48formed and price moves right up right
32:51past 5700 and continues higher. So, I
32:54don't want to be a first seller on that
32:56level and I'm gauging the reaction. Now,
32:58we have these zero prints. This will
33:00probably come back down and test it at
33:01some point, but you can see just how
33:04fast it'll break up through
33:08there. There it is. I'll just stop it
33:10again. 279 at the S, 279 orders come in
33:14and then there's just tons of buying and
33:15there's no selling. You have one seller
33:17on the bid and then all this buying and
33:21you can see all the delta. So, there's
33:22heavy buying going on at this high. Now,
33:24are they going to get put in pain if we
33:26come back down?
33:28Probably. But I don't want to just short
33:31blindly because there's a ton of
33:32liquidity at that
33:34level. All right, that's that's
33:36basically like a lockout. So now I would
33:38want to see from here if we kind of come
33:41back down and get underneath
33:4497700 then maybe those buyers get put in
33:47pain. But that's a uh that's like a
33:49lockout trade at the high right there.
33:51And the last thing I want to show you is
33:52just kind of how like the footprint like
33:54the bookmap like everything's kind of
33:56showing you like similar data. So
33:59there's my footprint chart and the depth
34:01of market on the right time and sales.
34:03So kind of watch as we we come into this
34:05high. Let me go full screen. All right.
34:07So, we make this high right here. And
34:09you can see the footprint, right?
34:11There's 30 47. There's 30 47 30 47 30 47
34:183047. All right. This left column is the
34:22delta. This right column is the volume.
34:24You have 30 market buys at 56.50. So,
34:28there's 30 on the ask, nothing on the
34:30bid. 30 delta and 30 volume. And then
34:33this 45 plus this one, what does that
34:36get you? 46. All right. So the depth of
34:39market, this column, the price ladder,
34:42it's showing us the same information
34:44that we can see on a footprint, even on
34:47bookmap. And even the time and sales
34:49column, like if I see a big order, this
34:51is filtered for higher. You can't really
34:53see it on this, but if like 600
34:55contracts came in, I would see 600 right
34:59here on the right. So it's showing you
35:01the same data. So it just kind of like I
35:04want I wanted you to see this. So it
35:06kind of like ties in, you know, the
35:08function of order flow is all these
35:10tools, they kind of show you the same
35:12data just in a little different way.
35:15Like I can see this the delta and the
35:17buying and the selling kind of like you
35:19know as a footprint like historically
35:21and then the the ladder shows it to me
35:23by price and I can actually see the way
35:26orders are moving on the bid on the ask.
35:29All right, but that's pretty much the
35:30depth of market. If you have any
35:32questions, please let me know. I hope um
35:36it's kind of hard to find good depth of
35:38market education. So, I hope I explained
35:41it in a easy way with the video. You
35:44know, it's just something that you watch
35:46and you get better at. But when you tie
35:48it into like the footprint, like you
35:50understand kind of like the relationship
35:51between everything and you just watch it
35:54at your key levels and gauge the
35:56reactions and over time you're going to
35:57learn how to get comfortable taking
35:59trade setups. So that's the depth of
36:02market. If you learn something new, drop
36:04a thumbs up. If you're new to my
36:05channel, I'd appreciate you subscribing
36:07so I can continue to make trading videos
36:09and provide value to those watching. If
36:11you're looking to level up your trading,
36:13we have our full-time trader course
36:14which gives you access to the Discord
36:16where I keep everyone updated on my
36:18thoughts and my trading throughout the
36:19day so that you can learn from the good
36:21and the bad of of what I'm doing and
36:22what I'm seeing. It's a more
36:23personalized approach to learning where
36:25you can interact with like-minded
36:27traders. That will be the first link
36:28down below. And with that, I'm ending it
36:30and I will see you in the next video.

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