Sometimes the market gives you a heads-up before things get interesting. That's what happened with Lumentum Holdings Inc. (LITE) on January 6, when a specialized trading signal called Power Inflow flashed at exactly 10:56 AM EST, with shares trading at $360.
Here's what makes this notable: LITE had been sliding downward all morning, dropping more than 4% in the hour leading up to the alert. Then the signal triggered, indicating a significant shift in order flow data toward the buy side from both institutional and retail traders. What followed was a steady climb that took the stock to an intraday high of $395.89 by 2:45 PM EST. That's a gain of nearly 10% from the signal price.
How the Power Inflow Signal Works
The Power Inflow alert is a proprietary indicator developed by TradePulse that's designed to catch meaningful shifts in buying activity early in the trading day. It only triggers within the first two hours of the session, which is when the signal developers believe you can spot the most actionable momentum.
The concept is straightforward: order flow analytics track who's buying and selling in real time by examining volume, timing, and order size across both retail and institutional participants. When the data shows a pronounced tilt toward buying pressure, the Power Inflow alert fires. The idea is that this shift suggests bullish momentum that could carry through the rest of the day, giving active traders a potential entry point before the broader market catches on.
Traditional technical analysis looks at price and volume after the fact. Order flow analytics, by contrast, aim to reveal what's happening beneath the surface by tracking the actual orders hitting the market. It's about understanding not just that a stock is moving, but who's moving it and how aggressively.
What Happened with LITE
The timing on Lumentum was particularly striking. The stock was declining when the Power Inflow signal appeared at $360. That's often when traders get nervous and sit on their hands. But according to the order flow data, both retail and institutional interest was shifting decisively toward the buy side right at that moment.
Anyone who acted on the signal and bought shares near $360 would have seen an intraday gain of almost 10% by mid-afternoon. The stock reached $395.89 as of 2:45 PM EST, demonstrating what proponents of order flow analysis would call a textbook example of catching a reversal before it becomes obvious on the price chart.
This kind of short-term price movement illustrates why some traders pay close attention to order flow data. The Power Inflow alert on LITE didn't just identify buying activity—it flagged it during a period when the stock price was actually falling, potentially offering an entry point that went against the immediate price action but aligned with the underlying order dynamics.
The Bigger Picture on Order Flow
Order flow analytics have become increasingly popular among active traders who want more granular insight into market sentiment. Instead of waiting for price confirmation, these tools attempt to identify accumulation or distribution patterns as they develop. The Power Inflow signal is one example of how this data gets packaged into actionable alerts.
Of course, no signal is foolproof, and intraday moves can reverse quickly. But for traders focused on short-term opportunities, understanding when institutional and retail flows are moving in the same direction can provide an edge that traditional indicators might miss.
In the case of Lumentum, the Power Inflow alert captured a moment when the market's internal dynamics were shifting bullish, even as the price action suggested otherwise. For those watching the order flow, it was a clear signal. For everyone else, it probably just looked like another morning selloff—until it wasn't.