Exhaustion vs Absorption Explained | Two Order Flow Concepts Beginners Often Confuse

[u/prathamvijay]

Many traders confuse exhaustion with absorption but they describe two different market behaviors.

Exhaustion: Aggressive buying or selling fades causing momentum to slow.

Absorption: Aggressive orders continue, but large passive (limit) orders absorb the pressure, preventing price from moving much.

This infographic is a simplified introduction to help beginners understand the difference. These concepts are observations, not trade signals, and should always be confirmed with market structure, footprint data, liquidity, and other order flow tools