Cumulative delta tracks net aggressive buying vs selling over time. When price makes a new high but cumulative delta fails to confirm (divergence), it signals weakening conviction. Aggressive buyers are being absorbed, not driving the move.
Indicators Used
OBVCMFVolume
Rules
📉 Short on Bearish Delta Divergence
- Price makes new swing high
- Cumulative delta (approximated via OBV/CMF) makes LOWER high
- This divergence signals absorption. Aggressive buyers being stopped at higher levels
- Wait for bearish reversal candle confirmation at the new price high
- Enter short on candle close
- Stop: above the price high
- Target: prior swing low, 3R minimum
📈 Long on Bullish Delta Divergence
- Price makes new swing low
- Cumulative delta shows higher low (less aggressive selling)
- Indicates selling exhaustion at the new low
- Bullish reversal candle confirmation
- Enter long, stop below price low, target prior high
Divergence
Required
3:1
R:R
💡 Pro Tip
True order flow delta requires exchange-level data (footprint charts, time & sales). OBV and CMF are reasonable proxies but imperfect. The strongest signals combine multiple delta proxies all diverging simultaneously.