Imbalances and stacked imbalances

Volume at any price is either balanced between the two sides or imbalanced. An imbalance occurs when one side exceeds the other by a certain ratio, measured diagonally between selling at one price and buying at the price above it. The common ratios are: 250%, 300% and 400%.

What it signifies

• Buy imbalance — the quantity bought at the offer exceeds that sold at the bid by the specified ratio. A sign of an aggressive buying surge.
• Sell imbalance — the quantity sold at the bid exceeds that bought at the offer. A sign of an aggressive selling surge.