I just saw someone ask how to read the order book, so I might as well share my understanding with everyone. Honestly, the order book looks complicated, but it’s really just a visual representation of the battle between supply and demand.

Taking LRC as an example, breaking the order book into two parts makes it clear. The red area is the sellers, and the green area is the buyers. Many people only look at the prices, but the real opportunity lies in the trading volume. Those long colorful bars? They are the accumulated trading volume; the longer the bar, the more orders are stacked at that price level.

The most important thing is to find the “walls.” The green wall represents support, where buyers are defending; the red wall represents resistance, where sellers are setting up defenses. When I look at the order book, the first thing I do is identify these large order accumulations. For example, if I see a trading volume of over 300K at a certain price, that’s a level worth paying attention to.

But here’s a trap — big players often use the order book to deceive retail traders. They might pile up large orders to create the illusion of support or resistance, then suddenly cancel them after you follow the lead. This is what’s called deceptive trading. So my advice is not to blindly trust every order on the order book; instead, combine it with price movements and volume changes to make judgments.

My own trading approach is like this: first, look at the order book to identify major support and resistance levels, then set stop-loss slightly above the green wall and take-profit slightly below the red wall. This way, I can protect myself without being too aggressive.

By the way, LRC is currently fluctuating around $0.02. Recent trading volume isn’t very high, but the structure of the order book still reveals the market’s true intentions. If you’re interested, you can open Gate and check out LRC’s order book, observing these points I mentioned. You’ll notice many details you previously overlooked.

Do you usually look at the order book when trading? Or do you just focus on candlestick charts?