Reading the DOM: the live price ladder

The DOM (depth of market) is the most direct way to look at the order book: a vertical ladder of prices showing, at each level, the quantity resting on the buy side and on the sell side. Traders also call it the “ladder”. It is the historical tool of futures traders, the one from the electronic trading floors of the 2000s, and it still sits at the center of modern order flow workstations.

Reading a DOM starts with learning not to look at everything. The numbers change dozens of times per second; your eye has to lock onto three things: the best bid and the best ask, the unusual sizes, and the way those sizes behave as price gets closer.