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Anonymous
hot to read orderbook? 2017-08-30 07:50:23 Post No. 3265236
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hot to read orderbook? 2017-08-30 07:50:23 Post No. 3265236
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I guess I get the general idea that the Ask is the price a seller wants to sell at, and Bid is what people are willing to pay for a coin.
So if the green part is larger than the red one, this means that more folks want something and less want to get rid of it, so the price should rise.
But, most of the time, most bids are pretty low, so people want something, but at a bargain? Now what does this tell me about the market?
And walls? A wall is essentially one large bid or ask, so one person wants to get rid of, or get a large amount of something.
But of course this are not necessarily real orders…
tl;dr:
Is there any good reading about some basic signals I can get from order books?
I dont want to do some total TA voodoo, but I feel like I need to do some reading.
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Looks like you figured out the gist of it.
And, as you say, with low volumes this is eveb more sketchy, and whales can shape the picture
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>>3265288
>Looks like you figured out the gist of it.
Seems like it, but
>and whales can shape the picture
This I'm not sure about.
Apart from some huge walls, I wouldn't know whats a "natural" book and whats a wale breeding ground.
And what is a good sign and a bid sign?
Take my OP pic.
More people want to buy (BAT in this case) than tere are people selling. So, that's good. But most people want a significant price drop first, so why would one want to buy, if you need a crash in price for it? It probably would drop further, if it gets to the bottom end of the book.
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One thing I like to look at is how the order book follows price movement.
If the price jumps a bit:
Orders fill gap quickly -> market thinks the movement is essentially correct and doesn’t want to miss out
Orders don’t really respond, newly covered ground is mostly flat -> market is relaxed, thinks price will be back to where it was, soon enough
In regards to walls: If you not only see them, but also see them go up, it can give you good info.
Often I’ve seen a downwards movement stifled by a wall appearing at some round number. If the wall is gnawed at and doesn’t attract other buyers piling on it, you can count on it disappearing after a while, because the buyer who put up the wall will figure he can get a better price.
When the wall disappears, price will obviously make a rather quick drop.
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>>3265328
>More people want to buy (BAT in this case) than tere are people selling. So, that's good. But most people want a significant price drop first, so why would one want to buy, if you need a crash in price for it? It probably would drop further, if it gets to the bottom end of the book.
The thing is, putting in an order that is far from the current price doesn’t make a whole lot of sense: You can always watch the price, putting your order in later, without letting the market know your intentions.
I think for small, high-volatility coins like BAT, a lot of the order book is people speculating on a drastic price movement in a short amount of time, where they might not have any time to react.
Putting in an order half-way down the book equates: "I believe price might drop sharply, and then at -50% that’s a bargain again, because it will surely rebound a bit from there."
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