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# Limit Order Count Ratio

## Definition

The **Limit Order Count Ratio** measures the **relative dominance of executed limit buy orders versus executed limit sell orders** by comparing the difference in their counts against their combined total. It highlights the **imbalance in the frequency of executed limit buy and sell orders**, providing insight into liquidity absorption and market behavior.

$$
\textbf{Limit Order Count Ratio} = \frac{\textbf{Limit Order Buy Count} - \textbf{Limit Order Sell Count}}{\textbf{Limit Order Buy Count} + \textbf{Limit Order Sell Count}}
$$

#### **Key Components:**

* **Limit Order Buy Count:** The total number of **executed limit buy orders** during a specific timeframe (orders resting on the book, filled by market sell orders).
* **Limit Order Sell Count:** The total number of **executed limit sell orders** during a specific timeframe (orders resting on the book, filled by market buy orders).
* **Ratio Range:** The ratio is typically **bounded between -1 and +1**, where:
  * **+1:** 100% buy-side dominance (only limit buy orders were executed).
  * **-1:** 100% sell-side dominance (only limit sell orders were executed).
  * **0:** Equal buy and sell limit order counts, indicating balance.