Absorption

Aggression that went nowhere

Most of the time heavy selling moves price down. That is what makes absorption stand out: the selling arrives, it is far heavier than anywhere else in the bar, and price still does not break.

The selling was not wrong to try. It ran into a patient buyer with enough size to take all of it. That buyer is the other side of the trade the crowd cannot see on a candle.

What to look for

Three things together make absorption:

One side's aggression is heavy at a price or a small cluster of prices - several times what the bar's typical row traded on that side.

That side was clearly the aggressor there: much more selling at the bid than buying at the ask, or the reverse.

And price failed to close beyond it. For selling, the bar closes at or above the cluster; for buying, at or below it.

Sellers absorbed, buyers absorbed

Selling absorbed at a low is bullish in tone: sellers spent their effort and buyers held. Buying absorbed at a high is bearish in tone: buyers lifted every offer and sellers did not move.

AXL Charts draws the two in different colours, so you can tell at a glance whose aggression was absorbed.

Absorption is a clue, not a trigger

Absorption tells you a level is being defended. It does not tell you how long the defence will last.

It matters most at places that already mean something: yesterday's value area edges, a naked POC, the initial balance, a single-print area. There, absorption is the order flow agreeing with the profile.

And because NSE data does not label the aggressor, buy and sell volume are inferred. Strong absorption stands out clearly; borderline cases deserve less weight.

Absorption in AXL Charts

AXL Charts marks absorption on the footprint: the absorbed rows are filled, sellers absorbed in one colour and buyers absorbed in another, and the level can be extended to the right until a later bar trades through it. The threshold - how many times the bar's typical row - is yours to set.