The basic principles and the three-confluence rule

Aggression versus passivity

• Passive orders (limits) wait for a price. They make up the liquidity, visible in the DOM and the heatmap.
• Aggressive orders (market orders) consume that liquidity and move the price, visible in the footprint and the delta.

Price rises when aggressive buyers dominate the passive offer. It falls when aggressive sellers dominate the passive bid. The speed of the move depends on the ratio between the aggression and the wall in front of it.

Absorption versus push

• Absorption: price tries to rise, passive sellers take it without backing off. Positive delta, stagnating price. Bearish signal.
• Push: price rises, the delta is positive, volume increases, the walls above thin out. Healthy trend, to be followed.