Up or Down?

One aspect of trading I continue to reference is "Structure Precedes Execution." Map out the areas of interest you (the trader) are willing to engage with before the auction shows you anything. The harder question — the one everyone is passive to answer — is what happens when price actually reaches those levels. There are "many ways to skin the cat," and the right one depends on how much screen time you have under your belt.

For most seasoned traders, activity on the DOM alongside structural components is enough. They've watched the book pull and stack thousands of times and don't need a secondary signal to confirm what they already see. But what about the trader who's still learning? That's the trader this post is for.

Why Most Beginners Struggle with Entry

When you're new to order flow, you're trying to read three or four data streams at once — the chart, the DOM, the time and sales, and the volume profile — without yet having the pattern recognition that makes any of them feel intuitive. The result is predictable: hesitation, late entries, or blind clicks at structure with no read on whether the auction is actually accepting that level.

A few patterns I see repeatedly when new traders try to build an entry process:

• Reviewing inflection points without a framework. It can seem like shooting in the dark. The trader sees a chart full of swings and tries to reverse-engineer why the market turned. Without a foundation in order activity, you're guessing. The OrderFlow Labs YouTube channel does a good job laying that foundation.
• Blindly placing trades upon structure. Not recommended. The ability to read structure comes from experience in understanding market activity. If you're already struggling with risk management or monitoring how structure forms in real time, blind entries just compound the loss and frustration.
• Watching live without a way to log what's happening. This is the one to focus on. Set up a means of reviewing information in a live setting that helps you avoid poor trade decisions and acts as an exercise in understanding inflection points.

That last one is the path forward for most beginners. You need a tool simple enough to read while building DOM and tape skills, but informative enough to give a real read on initiation activity.

At this point I'll assume you've reviewed the volume profile material on our YouTube channel — but here are the links if you haven't:

https://www.youtube.com/watch?v=gxLttec7Vz0&t=17s

https://www.youtube.com/watch?v=anDCfP7ep8w&t=9s

Those provide an understanding of structure as it's occurring. The harder question is the entry itself. How can we gauge entry without a background in DOM:

https://www.youtube.com/watch?v=VqTwFluyutA&t=5s

Or a background in Time and Sales:

https://www.youtube.com/watch?v=ggrFF9kdRDI&t=4s

A Beginner-Friendly Approach: Up/Down Tick Volume

Look at your chart. Whether you're trading a 5-minute candle, a tick or trade-based bar, or renko, you can plot the up/down tick volume difference underneath it. The indicator is simple: it sums volume that printed on upticks and volume that printed on downticks, then plots the difference. Positive readings mean more volume is going off on the offer. Negative readings mean more is going off on the bid.

Why does that matter? Because as volume builds inside your volume profile — and you're still working on T&S and DOM reading — the up/down tick difference is the simplest possible signal that a player is stepping into the auction. It collapses the four columns of the tape into one number. You don't have to read every print. You just have to read whether the auction is leaning up or leaning down at the level you care about.

This isn't a replacement for reading the tape. It's a bridge while you're still learning to interpret order activity directly. Used alongside the DOM, T&S, and volume profile, it accelerates the learning curve for entry positioning and allows for tight risk and continuation reads.

How to Read It

Three contexts cover most of what you'll see.

Trending Markets

If the market is in a downward trend, you'd expect to see continued negative readings on each downtick: sustained selling pressure printing as price works lower. The opposite holds for an uptrend. What you're looking for is agreement between price action and tick volume. Price moving down with shrinking negative readings — or, worse, with positive prints starting to show up — is your first warning that the move is losing initiation.

Consolidation

Inside a balance area, the tick volume difference will oscillate around zero. In consolidation, neither side is dominating. Don't fight it for an entry. Use it as a baseline. The signal you're waiting for is the break, the moment one side begins to consistently dominate the readings as price tests the edge of the range. That shift is what tells you a player is stepping in.

Shifts in Initiation

The most useful read happens at your pre-mapped levels of interest. Watch what the tick volume difference does as price arrives at the level. If the trend was down but the readings shift positive as price approaches a low-volume node or value area edge, that's a shift in initiation: the seller is exhausting and a buyer is stepping in. The reverse is true at upside levels. You're not predicting the turn; you're confirming the auction is no longer leaning the way it had been. That's the entry tell.

Combining with Volume Profile, DOM, and Tape

The up/down tick difference is a supplement, not a substitute. Pair it with the volume profile guide so you have pre-mapped HVNs, LVNs, and value-area edges to engage with. Use it alongside the DOM so you can see resting interest and pull/stack behavior at the level. Layer it with time and sales so you're getting the same read at two different resolutions — the tape gives order-by-order detail, the tick difference gives the rolled-up summary.

If those are saying the same thing as you arrive at structure, that's clean confluence. If they disagree, the trade isn't there yet.

Worked Examples

Try placing the up/down tick volume difference on a chart and reviewing the fluctuations against what's happening on your volume profile, DOM, and T&S. The screenshots below show what to look for.

In the first chart, the tick volume histogram sits directly below the candles so you can read it in lockstep with structure. Watch the moments where the histogram swings hard in one direction. Those are the windows where the auction is leaning, and where you'd cross-check the profile to confirm a level is being defended or breached.

The second example highlights a shift in initiation. Notice how the histogram flips polarity as price retests a prior level — that polarity flip, paired with what the profile is saying about the level, is exactly the kind of cross-confirmation you want before clicking.

The third chart shows the tool doing what it's designed to do: giving you a directional bias read while the DOM and tape update underneath. Use it as the first filter, then drill down to the tape to confirm the actual prints at the level. Structure first, then the tick volume read, then the tape and DOM for the click.