What Is a Depth Chart?
In crypto trading, a depth chart is a visual representation of market supply and demand.
Most centralized crypto exchanges (CEXs) show two main charts:
- A price chart, which shows historical prices, and
- A depth chart, which gives you a real-time snapshot of market supply and demand.
Understanding the Depth Chart
A depth chart is a visual way to see the buy and sell orders from the order book for a specific cryptocurrency, at various price levels.
It helps traders see how much demand (buying interest) and supply (selling interest) exists at different prices.
How to Read a Depth Chart
A depth chart usually contains:
- Bid line (green) – shows buy orders
- Ask line (red) – shows sell orders
- X-axis – shows price levels
- Y-axis – shows order quantity
Let’s go over each part:
Bid Line
This line shows the total size of buy orders (also called “bids”) at different prices. It’s usually displayed in green on the left side of the chart.
Ask Line
This line shows the total size of sell orders (also called “asks”) at different prices. It’s displayed in red on the right side.
Horizontal Axis (X-axis)
This shows the price levels at which people are willing to buy or sell.
- Left side (green) = Buy orders (bids)
- Right side (red) = Sell orders (asks)
Vertical Axis (Y-axis)
This shows the quantity of cryptocurrency people want to buy or sell at each price.
Many exchanges let you hover your mouse over points on the chart to see how many coins are being bought or sold at a given price.
How Does It Work?
A depth chart reflects market depth — the ability of the market to handle large orders without causing big price swings.
- The more pending buy and sell orders in the order book, the “deeper” the market.
- A deeper market = more stability and less volatility from large orders.
If the green (buy) side is much higher than the red (sell) side, it suggests stronger demand.
If the red side towers over the green, supply is greater than demand.
What Are Buy and Sell Walls?
Buy and sell walls are large volumes of buy or sell orders at a specific price level. On the chart, these walls form visible “cliffs” or “spikes”.
They can influence price behavior and show where traders expect strong support or resistance.
What Is a Buy Wall?
A buy wall appears when there are a lot of buy orders stacked at a specific price.
Example: If BTC/USD has a massive buy wall at $28,000, that means a lot of people are waiting to buy BTC if the price drops to that level.
- This could prevent the price from falling further, as buyers are eager to step in.
- Sometimes just seeing the buy wall is enough to push prices up—supply starts to dry up before the wall is even hit.
But beware: buy walls can be manipulative. A trader (“whale”) might place a large buy order just to make the market think there’s strong support—then cancel it later.
What Is a Sell Wall?
A sell wall is the opposite—it shows a large number of sell orders at a specific higher price.
Example: If BTC/USD has a big sell wall at $30,001, that means many traders are looking to cash out at that level.
- This can act as a ceiling, preventing prices from rising quickly.
- Traders might panic and sell before the wall is hit, fearing the price could reverse.
Just like buy walls, sell walls can be artificial, used to pressure the market downward or spook buyers into selling early.
Final Thoughts
Depth charts are more than just fancy graphs—they help you understand the psychology of other traders and spot key support/resistance levels.
By recognizing buy walls, sell walls, and overall market depth, you’ll be better equipped to time your trades and understand where prices might move next.