Market Depth Oscillator.
Appearance of the indicator.
Depth of market (DOM) calculates the depth of market indicator in increments of 1% from the marking price, starting from 1% and ending at 10%. Market depth is calculated as the sum of separately standing limit orders.
$$ DOM(x)= \sum_{i=Mark}^{x}{limit} $$
Indicator indicators are displayed as a histogram with gradient coloring. The warmest color corresponds to the depth closest to the marking price, the coldest - to the most distant one.
Settings of the indicator graphic.
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The model is available exclusively as an indicator.
The user can select the asset for which the market depth should be displayed, as well as the units of measurement: either USD or quoted asset (Coin).
In the chart settings window, the user can select the display colors and transparency of the indicator for each depth value.
The liquidity oscillator allows to quantify how liquid the ask and bid side of the bet is.
Let's look at an example with RUNE. On 24.02.2024 at 12:15 UTC+3 the DOM oscillator indicates an increase in the number of bids on the bid side.
How the imbalance situation looks like in the limit order book.
How the imbalance situation looks like in the limit order book.