Absorption at Extreme

From: $9.99 / month

Visualise the price levels where large traders are selling to, or buying from other traders and reduce your chances of being on the wrong side of the market.

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Numbers Bars allow us to highlight buying and selling imbalances – the actions of ‘aggressive’ traders hitting the bid or lifting the ask price and we make trading decisions according to the presence, quantity and location of these imbalances. The actions of ‘passive’ traders with limit orders however can be as revealing. Retail traders sometimes look at the DOM with a sense of mystery and a belief that identifying ‘spoofing’ and ‘iceberg’ or hidden order activity provides a key to success. In fact, the traded volume tells us everything we need to know by showing us what has happened and as importantly, what has not happened.

If large volume trades at a given price but price does not continue in the same direction, it tells us that the market orders trading at that price are being absorbed, i.e. there are large traders who are willing to absorb any amount of buying or selling at the price level in question. That is as important, if not more so, than the presence of a buying or selling imbalance. The emoji trading Absorption at Extreme and Absorption Sequence indicators help to identify absorption and highlight what is not happening providing the insight to avoid being on the wrong side of more powerful traders.

When absorption occurs at the extreme of a price bar and the bar direction opposes the price action leading up to this bar, there is a strong indication that high volume traders are defending a price level and can trade with sufficient volume to cause the previous move to stop and potentially reverse.

Absorption at Extreme may be licensed for Sierra Chart on a Lifetime, 1-month or 3-month basis, or as part of the complete Emoji Trading Order Flow Suite. Licences include all indicator updates and enhancements during the license period.

Input Name Description
Lookback Period If set to a value greater than 0, Absorption at Extreme conditions will not be displayed unless the current bar’s high (or low) is greater than (or less than) or equal to the highest high (or lowest low) within the lookback period.
Volume Threshold Basis Determines whether the Volume Threshold (see below) is evaluated using the volume or Delta at the price level where Absorption is occurring.
Volume Threshold Specifies the quantity of Volume or value of Delta (see above) that must be present at the price level where absorption is occurring in order for the Absorption at Extreme condition to be indicated.
EmojiZone Mode Please refer to this link for EmojiZone documentation.
Select whether the EmojiZone is set to: Disabled, Fixed Projection, Extend Until Future Intersection or Dynamic Support/Resistance Display.
EmojiZone Fixed Projection Distance Specifies the number of bars from the current bar that a Fixed Projection EmojiZone will be drawn.
EmojiZone Extension Line Label Specifies the line label (can be left blank) for an Extend Until Future Intersection EmojiZone line.
EmojiZone Dynamic Break Threshold When using a Dynamic Support/Resistance Display EmojiZone, this input sets the number of ticks by which the zone can be breached without it being regarded as having broken.
EmojiZone Dynamic Evaluation Levels If set to 0, every current EmojiZone is evaluated at each study calculation. To reduce processing time, a non-zero value will limit calculation to the nearest n EmojiZones to the current price where n is the value entered in this setting.
ID Subgraph Description
SG1 Bid Absorption Price The price level at which selling into the bid is being absorbed, i.e. a large buyer has demand at this price creating potential support.
SG2 Bid Absorption Drawing Top Use in conjunction with SG3 to highlight the bid absorption price. Please refer to the Sierra Chart Notes about Top and Bottom Draw Style Pairs.
SG3 Bid Absorption Drawing Bottom Use in conjunction with SG2 to highlight the bid absorption price. Please refer to the Sierra Chart Notes about Top and Bottom Draw Style Pairs.
SG4 AskAbsorption Price The price level at which buying at the ask is being absorbed, i.e. a large seller is supplying at this price creating potential resistance.
SG5 Ask Absorption Drawing Top Use in conjunction with SG6 to highlight the ask absorption price. Please refer to the Sierra Chart Notes about Top and Bottom Draw Style Pairs.
SG6 Ask Absorption Drawing Bottom Use in conjunction with SG5 to highlight the bid absorption price. Please refer to the Sierra Chart Notes about Top and Bottom Draw Style Pairs.
SG7 EmojiZone Properties Use the Color, Width/Size and Transparency Level for Fill Styles inputs to customise the appearance of this indicator’s EmojiZones. Please refer to this link for the EmojiZone documentation.