Heat map as a phenomenon has been known for a long time. The heat map on limit orders has also managed to ‘become obsolete’. But what has Resonance produced that is so revolutionary that it bypasses all others by several orders of magnitude?

Before answering this question, we need to remember the base.

In an order market (crypto and stock markets), the price is moved by market orders sent to the order book. And if the order is pending (limit), it can:

If an order with immediate (market) execution, then such an order is executed against a limit order. It does not wait. It is executed on the nearest available order. It is this type of order that determines where the price will move.

We must evaluate the actions of one and the other at the same time. Let me give you an analogy - no competent offensive is conducted only by assault squads. If there is no support and provision, there is no assault.

Why? Because an assault consumes a lot of resources, and if logistics are poorly organised, then the attackers, after advancing, will quickly be thrown back to the same positions they were in.

And the goal of any offensive is to gain a foothold on the captured positions, otherwise it turns out that the resource was wasted.

Assault units are market orders, and their support and logistics are limit orders.

Let's look at the example below.

There are limit buyers in the blue zone of the heat map. There are a lot of them, they are ‘entrenched’ and ‘waiting’ for the ‘attack’ of sellers.

Sellers attacked in three waves, marked by red arrows on the cluster chart.

Note: we look at the actions and successes of the offensive on the cluster chart. We look at the actions of the support and logistics on the heat map.

The last third wave was the final wave.

We see the sellers' offensive on the histogram below the chart. The red bars at the bottom indicate that the sellers were wasting resource to push the price down.

But where is the limit support for the sellers????

Exactly because there is no limit support for the sellers - the blue arrow marks the place where the sellers' efforts had no success, and, in fact, no sense - the buyers definitely held the price boundary and even slightly pushed back the sellers.

If you, as a commander, notice that the enemy does not have the resource to advance, then you are the one who starts to advance.

The green arrows are the offensive of market buyers. We see that there is success. But why?

Price is the ‘line of contact.’ Clusters are ‘battlegrounds.’

- Do you see sellers' support above the line of contact?

- It's not there.

- Where is the support for the advancing buyers?

- Far away (blue arrow and blue zone).

Conclusion: ‘logistics’ of the buyers are also bad. But the price does not fall to this ‘support’ only because the sellers have not ‘gathered their strength’ yet.

So, sellers are not yet on the active attack. Let's pay attention to the fact that buyers pulled up reserves a bit (blue zone).

And, inspired, the market buyers continued their attack, which can be seen in the delta histogram (green bars).

But there was no success.

The sellers regrouped and built a tight defence, so the buyers could not go above the previous high. There was not enough volume of buys.

What has just been described is strategic market configurations.

Strategic actions always consist of small tactical actions.

There is even a saying: losing a battle does not mean losing the war.

The breakthrough of the line of contact always takes place in areas where there is a bigger concentration of forces and means than the enemy.

And how do we understand at what price points what concentration of forces the sides have?

And now we will answer the question about the advantage of the heat map from Resonance.

The anomaly of forces and means of the parties is determined by how much volume is brought close to the price. And which side has brought more volume close to the price. Who has better logistics. And who has more active ‘assault’ units.

Here's an example.

On the heat map by volume we see dense ‘defence’ on both sides.

We see parity between buying and selling.

But if there is ‘parity’ here, then why is the price fluctuating at all? Nonsense!

The answer is banal and obvious, there is never parity in the market. There is always a preponderance of one side. ALWAYS! It's just that the size of the preponderance is different. Somewhere more, somewhere less.

And now the key point that will help us in trading. It is that the heat map in the Z-score mode is like a good ‘reconnaissance’, it highlights those volumes that can really at the moment significantly affect the price. This gives us a huge advantage, because among all the noise of market battles we can determine which side, buyers or sellers, at the moment has the intention to attack and is preparing rear reserves (limit orders). The blue areas clearly demonstrate this.

Notice how price is pushing away from the areas of these limit accumulations. All that remains is to wait for the ‘storming’ forces to ‘bog down’ and join the counterattack.

We remember that the market is a constant battle between buyers and sellers. There are a huge number of participants in this battle. The question is, which side do you want to be on? On the side of the winners or those who are losing?

Battles are won by those who have the advantage.

And our innovative heat map is one of the advantages that Resonance brings to market trading.

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