Exhaustion: when the aggression dies out

Exhaustion is the quiet cousin of absorption. In absorption, the aggression is strong and a wall stops it. In exhaustion, there is not necessarily a wall: the aggression itself dies out. The buyers in a rally buy less and less, each new high attracts fewer participants, and the move ends up dying for lack of fuel.

You spot it before price turns, because all the tools that measure aggression decline while price still keeps going a little further.

The signs

• The bubbles shrink in the direction of the move, and those of the opposite side grow.
• Candle delta decreases with each new high, until it turns negative (trap 4 in module 5).
• The CVD diverges: it no longer follows the new price extremes.
• The tape slows down: Speed of Tape drops back below its average while price prints new highs.
• The auction finishes: the high of the last candle shows zero at the ask, nobody is paying the offer anymore.