Definition

Consumption

The reduction of resting liquidity caused by aggression filling against it. One reason a level that held before may break.

Full Explanation

Every time aggression arrives at a level and gets absorbed, some of the liquidity that did the absorbing is consumed. The limit orders that filled against the aggression are gone. The shelf gets lighter. If aggression visits the same level repeatedly, consumption accumulates — each visit leaves the level with less liquidity than before. Eventually the remaining liquidity may be insufficient to absorb the next wave, and the level breaks — not because anything changed visibly on the chart, but because the orders that made it hold have been used up.

In the Book 1 chapter

Chapter 4 · The Mechanics

The Living Order Book

There’s a belief that floats around trading communities, stated so often it’s become assumed wisdom: if a level has been tested multiple times, it’s getting weaker. The idea is that each visit to a level chips away at the liquidity sitting there — buyers or sellers getting used up — and eventually there won’t be enough left to hold, and the level breaks.