What Is the DOM?

The DOM is more than a ladder full of numbers.

The Depth of Market displays resting buy and sell limit orders at different price levels, depending on the feed and configuration.

Traders use it to observe:

• Available liquidity near the current price

• Changes in displayed order sizes

• Potential areas of interest

• How the order book changes as price approaches a level

However, displayed liquidity can be cancelled before execution. A large order isn't proof that price will reverse.

I prefer to think of the DOM as a source of information, not a crystal ball.

The real question is what happens when price reaches the liquidity.

#DOM #OrderBook #Futures