Absorption and exhaustion on the DAX

Two end-of-move signals, one book

Absorption and exhaustion are the two ways a move stops. In absorption, aggression continues and a limit takes it: maximum effort, zero result. In exhaustion, aggression stops by itself: buyers have finished buying, and price falls for lack of demand, without anyone really selling.

On the DAX, both read better than on the Nasdaq, for the reason given in module 3: the compressed book. But they are read with different thresholds, and confusing them is costly because they call for different entries.