How to Read the DOM (Depth of Market) in Futures Trading
The DOM shows the limit orders waiting above and below the market, price by price. Learning how to read the DOM means separating what is offered from what actually trades, and knowing what the ladder never shows.
The DOM, or depth of market, is a vertical price ladder that shows the limit orders currently waiting to be filled. Buy orders (bids) sit below the market, sell orders (offers, or asks) sit above it, and each row tells you how many contracts are resting at that price. Knowing how to read the DOM comes down to three habits: watch the best bid and best offer first, compare every change in size with what actually trades, and treat everything away from the inside market as provisional.
The ladder is a picture of liquidity, not of commitment. Anyone who placed a limit order can cancel or move it before it is touched, and part of the liquidity in a futures book is never displayed. That is why the DOM is read together with the tape and a chart rather than on its own, and why it says more about the next few ticks than about the rest of the session.