Order Book Granularity

Order book granularity refers to the level of detail available in the price-volume distribution of an order book. It is determined by the tick size and the frequency of updates from the matching engine.

High granularity provides a clear picture of support and resistance levels, allowing traders to make more informed decisions. Low granularity, caused by large tick sizes, makes it difficult to distinguish between meaningful price levels and noise.

In crypto markets, different exchanges offer varying levels of granularity, which can impact the precision of automated trading strategies. Analysts use this data to identify imbalances in supply and demand that precede price movements.