Glossary · Orderflow
Absorption is when a large resting order soaks up a stream of aggressive market orders without the price moving — repeated selling hits the bid, or buying lifts the offer, and the level simply doesn't break. It signals a big participant willing to take the other side, and it often marks where a move runs out of fuel and reverses.
It is one of the core tape-reading tells, and it is essentially invisible on a candlestick chart — you only see it in the order flow: heavy aggressive volume into a price, but no progress.
On the tape, you see a burst of aggressive prints hitting one side — say, sellers repeatedly hitting the bid — while price barely ticks. On the DOM, the resting size at that level keeps refreshing: it gets eaten, more appears, it gets eaten again. On the footprint, the bar shows large delta concentrated at the price with no corresponding move.
Put together: a lot of aggression, almost no result. Someone passive is taking everything the aggressors throw at them.
The two look similar — both stall a move and often precede a reversal — but the mechanism differs. Absorption is active: a large passive participant is defending a level, buying every contract the sellers offer. Exhaustion is passive: the aggressive side is simply running out of participants, so the move dies on its own.
Cumulative delta helps tell them apart. In absorption, delta keeps climbing (or falling) hard while price stays pinned — the aggression is real but it's being eaten. In exhaustion, the aggression itself fades. Either way, the move's fuel is gone.
Absorption cannot be read off a candle — by the time the bar closes, the story is gone. You need the footprint (delta at each price), the DOM (the resting size doing the absorbing), and the tape (the aggressive prints) together, in the same moment.
That is the practical case for one workspace: the absorption, the level it's defending, and the gamma wall it may be sitting at belong on a single chart, not scattered across three windows you alt-tab between during a fast move.
A stacked imbalance is aggressive pressure piling up on one side across consecutive levels — a sign of force. Absorption is that pressure being soaked up at a level without price moving — a sign the force is being met. One shows aggression; the other shows aggression failing.
It depends on where it happens. Buy-side absorption at support (a passive buyer eating all the selling) is bullish; sell-side absorption at resistance (a passive seller eating all the buying) is bearish. Context — the level it occurs at — sets the direction.
Look for heavy aggressive volume into a price with little or no movement: large delta on the footprint with price pinned, resting size on the DOM that keeps refreshing as it's hit, and cumulative delta diverging from price.
No — it's a tell, not a signal. Absorption marks where one side is defending a level, which often precedes a turn, but it should be confirmed (for example, by the aggressive side giving up and price rotating away) before acting on it.
Absorption is exactly what Sharpnel is built to show — the footprint, the DOM, and the reconstructed tape on one chart, so you see the size doing the absorbing as it happens. Free Explorer tier on 15-min delayed data.
