Reading a depth chart and order book

1. Anatomy of an order book

An order book is the list of every unfilled buy order (bid) and sell order (ask) on a market. Bids on the left, asks on the right, sorted by price. The top of the book is the best bid (highest price someone will pay) and the best ask (lowest price someone will sell at). The difference between them is the spread.

On bitexasia, the order book on the trading page shows you ten levels of bids and ten levels of asks by default. Each level shows price, size, and aggregated size cumulatively from the top. The depth chart visualises the same data as a stacked-area graph — bids in green on the left, asks in red on the right.

2. Spread tells you liquidity, not direction

A tight spread (BTC/USD spreading 0.5 bps on a major exchange) means there's a lot of liquidity at the touch. A wide spread (50+ bps on a small-cap) means market makers don't want to quote tightly — too much volatility, too little flow, or both. Spread on its own says nothing about direction.

3. Walls are mostly noise

A "wall" is an unusually large limit order at a single price. They look impressive on the depth chart — a tall step in the staircase. They're also usually fake.

Real conviction in a price doesn't sit at one level forever; it gets executed or cancelled. Walls that persist for hours are usually market-makers signalling intent, hoping to push price in their direction. They get pulled the moment price approaches them. Don't trade off walls. They're news, not strategy.

4. What the shape actually tells you

Three patterns to watch:

• Symmetric, smooth book. Equal liquidity on both sides, no obvious clusters. Market is in equilibrium. Quiet conditions.
• Lopsided book — more bids than asks. If price is rising, this confirms the move (buyers are queueing up). If price is falling, this is a setup for a reversal (the buy-side is absorbing the dump).
• Thin book on one side. Almost no liquidity 1–2% away from touch on one side. Means a market order in that direction will move price a lot. Set limit orders, not market orders, in this state.

5. Partial fills and how they look

When you place a market order, it eats through book levels top-down. A 1 BTC market buy on a thin book might fill 0.6 BTC at $67,250, 0.3 BTC at $67,260, and 0.1 BTC at $67,275. Your average price is worse than the touch — that's slippage. The depth chart helps you estimate this before you click; bitexasia also shows estimated slippage live in the order ticket.

6. The book is a snapshot, not a video

The order book updates many times per second. What you see on the screen at 14:32:15.7 is not the same as what the matching engine sees at 14:32:15.71. Don't make decisions assuming any specific level will still be there when your order arrives. Use limit orders for precision, market orders for speed, and accept that those are the trade-offs.

7. How to practise

Pick a high-volume pair (BTC/USDT or ETH/USDT). Open the order book and watch it for ten minutes during the US trading session. Don't trade. Just watch. Notice how walls appear and disappear, how the spread tightens and loosens, how a single large market order shows up as a sequence of fills. Once that motion makes sense, your order ticket will start asking you smarter questions.