A failed auction occurs when the market attempts to explore higher or lower prices but fails to attract sufficient participation.
Look for:
Rejection at market extremes.
Lack of continuation.
Opposite-side participation.
Return into the previous trading range.
Failed auctions can provide useful reversal opportunities.
Do you use TPO or footprint charts to identify failed auctions?
I use both TPO and footprint charts to identify failed auctions and confirm market rejection.
Failed auctions become more meaningful when price returns inside the previous trading range.
I focus on price rejection and opposite-side participation before considering reversal entries.
Footprint charts help me understand order flow, while TPO provides broader market context.
A failed auction is not a reversal signal by itself; confirmation and risk management are essential.
